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Questions and Answers
What is one of the key factors a businessman must analyze before starting a new project?
Why is it important to assess risks before starting a new business project?
Which type of risk is related to uncertainties that cannot be covered by insurance?
What is one of the significant risks mentioned in the text?
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What is described as the 'Life Blood' of business in the text?
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What is a key factor that largely influences the success of a business according to the text?
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In the context of business, what is the main objective of all enterprises as mentioned in the text?
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What are the two main aims mentioned for an enterprise in the text?
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What areas are mentioned as needing planning before starting a business in the text?
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What is highlighted as becoming more complex in a large business according to the text?
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Which phrase captures the essence of the modern business world according to the text?
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Study Notes
Prospect, Risks, and Uncertainty
- Before starting a new project, a businessman must analyze business opportunities in terms of expected profits, possibility of success, and nature of demand.
- Assessment of business opportunities helps satisfy the demands of owners, management, employees, consumers, and the government.
- Risks and uncertainties in business may spoil the chances of success in the future, so they must be calculated and studied carefully.
- There are two types of risks: insurable risks and uninsurable risks.
Capital
- Capital is the "Life Blood" of business and is required for starting and continuing a business.
- Finance is concerned with providing the necessary capital for various purposes, including investment in fixed assets like land, building, machinery, and equipment.
- Successful results in business depend largely on the ability of entrepreneurs to anticipate and solve problems with minimum cost.
Starting a Business
- Planning is essential before starting a business, and entrepreneurs must anticipate and solve problems like location, equipment, shop layout, purchasing, and financing needs.
- These problems become more complex in a big business.
Basic Motive of Business
- The basic motive of all business concerns is to earn profits through the exchange of goods and services for mutual benefits.
- The two aims of an enterprise are to maximize profits and minimize costs and expenses.
- Production, marketing, and sales activities are guided by the attainment of the basic motive of income over expenditure.
Important Factors to Consider
- A person should consider the following factors before starting a business: Prospect, Risks, and Uncertainty, Capital/Finance, Location, Organization and Management, Government Laws and Policies, Marketing, Labour, and Business Information.
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Description
Test your knowledge on anticipating and solving problems in business with minimum cost. Learn how to start a business successfully by mastering problem-solving skills. Explore common problems encountered by business firms in the modern competitive world.
