Entrepreneurship and Business Structures Quiz
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Questions and Answers

What is one advantage of establishing a public limited company?

  • Ability to raise capital from sale of shares (correct)
  • Publicity restrictions
  • Unlimited liability
  • Limited control

Owners of public limited companies have unlimited liability.

False (B)

What is a disadvantage of being a sole proprietor?

Unlimited liability

Public limited companies have the ability to sell shares to the _____ .

<p>public</p> Signup and view all the answers

Match the advantages and disadvantages to their corresponding business types:

<p>Sole Proprietorship = Unlimited liability Public Limited Company = High legal formalities</p> Signup and view all the answers

What is one way businesses can build customer loyalty?

<p>Offering discounts and promotions (B)</p> Signup and view all the answers

Intrapreneurs work independently from the existing business structure.

<p>False (B)</p> Signup and view all the answers

What are the three primary sectors of entrepreneurial activity?

<p>Primary sector, Secondary sector, Tertiary sector</p> Signup and view all the answers

Intrapreneurs can potentially earn a promotion or wage ___ based on their contributions.

<p>raise</p> Signup and view all the answers

Match the entrepreneurial sector with an example:

<p>Primary sector = Fishing Secondary sector = Craft manufacturing Tertiary sector = Hairdressing</p> Signup and view all the answers

What is a primary risk associated with entrepreneurship?

<p>Loss of investment (B)</p> Signup and view all the answers

Providing goods that meet specific needs can create a competitive edge for businesses.

<p>True (A)</p> Signup and view all the answers

What is the potential reward for a business that successfully engages in intrapreneurship?

<p>Profit and improved product offerings</p> Signup and view all the answers

What is a takeover in a business context?

<p>Acquisition of more than 50% of another company's shares (C)</p> Signup and view all the answers

A friendly merger involves taking over a company without its consent.

<p>False (B)</p> Signup and view all the answers

Name one strength of family-owned businesses.

<p>Commitment</p> Signup and view all the answers

A ________ takeover occurs without consent of the target business.

<p>hostile</p> Signup and view all the answers

Match the type of integration with its description:

<p>Horizontal = Same industry at the same stage of production Vertical forward = Same industry as a customer of existing business Vertical backward = Same industry as a supplier of existing business Conglomerate = Different industry</p> Signup and view all the answers

What is a potential weakness of family businesses due to personal relationships?

<p>Nepotism (C)</p> Signup and view all the answers

Internal conflicts in family businesses can positively impact management.

<p>False (B)</p> Signup and view all the answers

What issue might arise from informality in family-owned businesses?

<p>Inefficiencies</p> Signup and view all the answers

Which approach argues that focusing on stakeholders other than shareholders might reduce profits due to non-essential costs?

<p>Shareholder perspective (B)</p> Signup and view all the answers

Paying low wages and making people work long hours is considered ethical as long as the laws permit it.

<p>False (B)</p> Signup and view all the answers

What is one way to resolve conflicts that arise from satisfying different stakeholder aims?

<p>Gradually phasing out a product line to support employees.</p> Signup and view all the answers

Companies must assess the impact of negative publicity on __________.

<p>revenue</p> Signup and view all the answers

Match the following stakeholder aims with their potential solutions:

<p>Supporting employees = Gradual product line phase-out Minimizing local disruption = Relocating new facilities Addressing local noise concerns = Funding noise reduction projects Balancing conflicting interests = Higher executive compensation</p> Signup and view all the answers

Which of the following is NOT mentioned as a way senior management can balance stakeholder interests?

<p>Increase prices for consumers (B)</p> Signup and view all the answers

Exploitative practices become ethical if they are not illegal.

<p>False (B)</p> Signup and view all the answers

What is the primary aim of human resource management?

<p>To recruit capable, flexible, and committed people.</p> Signup and view all the answers

What was a characteristic of HRM in the past?

<p>Bureaucratic and inflexible approach (D)</p> Signup and view all the answers

The current role of HRM includes solely focusing on recruitment and selection.

<p>False (B)</p> Signup and view all the answers

What is the primary purpose of HRM?

<p>To ensure maximum productivity and meet corporate objectives.</p> Signup and view all the answers

HRM includes a '__________' for the job based on analyzing the qualities needed.

<p>person profile</p> Signup and view all the answers

Which of the following is NOT a current role of HRM?

<p>Managing strategic financial investments (C)</p> Signup and view all the answers

Match the following HRM roles with their descriptions:

<p>Recruitment and Selection = Finding the most suitable employees Employee Development = Providing training and appraisals Workforce Planning = Identifying future employee needs Job Advertisement = Communicating job requirements to potential hires</p> Signup and view all the answers

What process identifies the future needs in terms of number of employees and skills required?

<p>Workforce planning</p> Signup and view all the answers

Job advertisements can be displayed both internally and externally.

<p>True (A)</p> Signup and view all the answers

Which of the following is considered a hygiene factor?

<p>Job Security (A)</p> Signup and view all the answers

Motivators such as achievement and recognition are essential for employee motivation.

<p>True (A)</p> Signup and view all the answers

What term describes the factors that remove dissatisfaction but do not motivate employees?

<p>Hygiene factors</p> Signup and view all the answers

Workers must be given accurate feedback on their work, and good work must be recognized to ensure __________.

<p>motivation</p> Signup and view all the answers

Match the needs to their corresponding description:

<p>Physical needs = Food, shelter, water, rest Safety needs = Job security and health Social needs = Trust, friendship, teamwork Esteem needs = Respect, status, recognition</p> Signup and view all the answers

Which of the following principles emphasizes allowing workers to complete entire units of work?

<p>Job Enrichment (B)</p> Signup and view all the answers

Regression means that once a need is satisfied, an individual cannot be motivated again by that need.

<p>False (B)</p> Signup and view all the answers

List two examples of motivators that can inspire employees.

<p>Achievement, recognition</p> Signup and view all the answers

Flashcards

Possible reward for building a customer base

The potential gain for an entrepreneur in the form of profit.

Possible risk for building a customer base

The risk that an entrepreneur takes, such as loss of investment or damage to reputation.

Intrapreneur

Someone who develops and executes innovative ideas within an existing company.

Possible reward for an intrapreneur

The potential gain for an intrapreneur, which could include profit, sales, diversification, promotion, or wage raise.

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Possible risk for an intrapreneur

The risk that an intrapreneur takes, which could involve damage to the company's reputation or loss of investment.

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Injecting creativity and innovation

The process of bringing new ideas and innovation to a business, boosting sales and product quality.

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Developing new business methods

Creating new and better ways of working within a business to address problems and improve efficiency.

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Encourage original thinkers to stay and innovate

Encouraging employees to think outside the box and contribute fresh ideas to a company.

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Sole Trader

A business owned and run by one person, where the owner has complete control and unlimited liability.

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Partnership

A business owned by two or more people, who share profits and losses.

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Private Limited Company (Ltd)

A type of business where the owners have limited liability, meaning they are only responsible for the amount they invested.

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Public Limited Company (PLC)

A company that can sell its shares to the public, giving them access to a wider range of investors.

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Limited Liability

The legal principle that protects the owners of a company from personal liability for the company's debts.

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Shareholder Perspective

The idea that businesses should primarily focus on maximizing profits for shareholders, potentially neglecting other stakeholders.

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Stakeholder Approach

The idea that businesses should consider the needs and interests of all stakeholders, including employees, customers, suppliers, and the community.

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Stakeholder Conflict

Conflicts that arise when different stakeholder groups have competing goals or interests.

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Gradual Phase-Out

A strategy to resolve stakeholder conflicts by gradually phasing out products or services to minimize job losses and disruption.

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Relocation

Relocating business operations to a new location to minimize disruption to the local community.

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Noise Reduction

Investing in measures to reduce noise pollution or other negative impacts caused by business operations.

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Prioritizing Stakeholders

Determining the relative importance of different stakeholder groups based on their influence and impact on the business.

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Human Resource Management (HRM)

The process of attracting, developing, and retaining skilled and motivated employees to achieve business goals.

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Takeover

A situation where one company acquires more than 50% of the shares of another company, gaining control of the target company.

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Horizontal Integration

A type of integration in which two companies operating in the same industry at the same stage of production merge.

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Forward Vertical Integration

A type of integration where a company expands by acquiring a business within its own industry but at a different stage of the production process, becoming its customer.

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Backward Vertical Integration

A type of integration where a company expands by acquiring a business within its own industry but at a different stage of the production process, becoming its supplier.

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Conglomerate Integration

A type of integration where a company expands by acquiring businesses in unrelated industries.

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Friendly Merger

A takeover where the target company consents to the acquisition by the acquiring company.

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Hostile Takeover

A takeover where the target company does not consent to the acquisition by the acquiring company.

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Commitment

The potential for family owners to show greater dedication and commitment to the business they are taking over.

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What is the purpose of HRM?

HRM focuses on achieving maximum productivity by recruiting, training, and developing employees to meet corporate goals.

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What is job profiling in HRM?

HRM encompasses analyzing the needed skills and qualities for a specific position, creating a 'person profile' for the ideal candidate.

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What is a job advertisement?

Job advertisements outline the requirements and qualities needed for a position, attracting potential candidates.

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What is workforce planning?

Forecasting future workforce needs in terms of employee numbers and skills.

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What is recruitment and selection?

This involves finding and choosing the best candidates for specific roles. It's a key area of HRM.

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What is developing employees?

This involves training, appraisal, and development to enhance employee skills and potential. It's a vital part of HRM.

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How did HRM approaches differ in the past?

In the past, HRM was often bureaucratic, inflexible, and focused solely on recruitment and selection.

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What is the modern role of HRM in organizations?

HRM is an integral part of strategic management, working closely with leadership to achieve business goals.

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Hygiene Factors

Factors that do not motivate but their absence causes dissatisfaction, such as salary, working conditions, supervision, social relations, safety, and security.

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Motivators

Factors that motivate employees and lead to job satisfaction, such as achievement, recognition, work itself, responsibility, and advancement.

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Range of Tasks

Workers should be given challenging tasks beyond their current experience to keep them engaged and encourage growth.

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Complete Units of Work

Allowing employees to complete units of work from start to finish, giving them a sense of accomplishment and ownership.

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Feedback on Performance

Providing feedback on performance, both positive and constructive, to help employees improve and feel valued.

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Teamwork

Encouraging teamwork and collaboration to foster a sense of community and shared responsibility.

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Maslow's Hierarchy of Needs

The idea that once a need is met, higher-level needs become more important. Unmet needs can create dissatisfaction, while met needs can motivate.

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Job Enrichment

The process of improving job satisfaction by giving employees more control and responsibility over their work.

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Study Notes

AS Level Business - Summary Notes

  • This document is a summarized set of notes on the theory syllabus for CAIE AS Level Business.
  • It covers various topics ranging from enterprise and economic activity to business structure and ownership.
  • It also includes aspects of business planning, motivation, and managing cash flow.
  • The information presented is factually accurate and detailed.
  • The document covers topics like different business structures, types of economies, entrepreneurial roles, challenges, and impacts on the economy.
  • It also explains how to evaluate different business environments and predict future trends, along with solutions to those challenges.
  • It covers business uncertainty, business plans, business structure, classifications of business activities, and an overview of the different ways businesses are structured, including public and private sectors.
  • It also details various stakeholder interactions and their effects on business decisions.

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Description

Test your understanding of the advantages and disadvantages of various business structures, including public limited companies and sole proprietorships. This quiz also explores entrepreneurial activity, risks involved in business, and ways to foster customer loyalty.

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