Introduction to Business & its Environment

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Questions and Answers

Why is 'economic activity' considered a fundamental feature of a business?

It's the primary means through which businesses generate revenue and create value. (correct)
It ensures businesses comply with environmental regulations.
It prioritizes social welfare over financial gain.
It focuses solely on charitable contributions and community development.

In the context of business, why is 'legal and lawful' operation important?

To disregard consumer rights in pursuit of higher profits.
To ensure ethical conduct, maintain a positive reputation, and avoid legal repercussions. (correct)
To gain an unfair advantage over competitors through loopholes.
To minimize costs associated with regulatory compliance.

How does 'continuity in dealings' contribute to the success of a business?

By ensuring that all transactions are conducted online.
By fostering lasting relationships with customers and suppliers. (correct)
By focusing only on short-term transactions for immediate profits.
By creating a predictable pattern of irregular sales fluctuations.

What role does 'uncertain returns' play as an element of risk in business?

It highlights the potential for losses or lower-than-expected profits due to unpredictable factors. (C) Signup and view all the answers

Why are 'production and purchases of goods and services' essential activities for most businesses?

They form the core processes of creating and delivering value to customers. (C) Signup and view all the answers

How does 'consumer satisfaction' directly benefit a business?

By generating repeat business, positive word-of-mouth, and brand loyalty. (D) Signup and view all the answers

What is the relationship between 'profit earning' and the sustainability of a business?

Profit earning provides the resources necessary for growth, innovation, and covering operational costs. (D) Signup and view all the answers

How does collecting raw materials contribute to sustaining a business?

It ensures a steady supply for production, affecting product quality and cost. (B) Signup and view all the answers

What does it mean to say that 'to sustain business, purchase is must'?

The ability to procure necessary resources (goods, services, raw materials etc.) is essential for a businesses to maintain & continue its operation. (A) Signup and view all the answers

How are 'profit' and 'continuous cycle' related in the context of a business?

Profit, when reinvested, fuels the continuous cycle of production, sales, and further investment, enabling long-term growth. (D) Signup and view all the answers

Flashcards

Business

An activity related to the production, distribution, and sale of goods or services for profit.

Profit

The financial gain or benefit resulting from business activities, after deducting expenses.