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Questions and Answers
What is the main characteristic of an entrepreneur?
What is the main characteristic of an entrepreneur?
- They only manage existing businesses without innovation.
- They work solely for large corporations.
- They generate new business ideas and assume risks for rewards. (correct)
- They usually do not bear any financial risks.
Which of the following best describes 'added value' in a business context?
Which of the following best describes 'added value' in a business context?
- The total production costs associated with manufacturing.
- The increase in the selling price compared to input costs. (correct)
- The profit margin achieved by reducing operational expenses.
- The initial investment required to start a business.
What distinguishes a public limited company from a private limited company?
What distinguishes a public limited company from a private limited company?
- Public limited companies cannot issue shares to the public.
- Private limited companies have unlimited liability for their shareholders.
- Private limited companies are owned only by the government.
- Public limited companies can trade shares publicly on stock exchanges. (correct)
In which sector do firms that extract natural resources operate?
In which sector do firms that extract natural resources operate?
What is the primary function of a business plan?
What is the primary function of a business plan?
What is a key difference between consumer goods and consumer services?
What is a key difference between consumer goods and consumer services?
Which type of business activity is involved in the manufacturing of goods?
Which type of business activity is involved in the manufacturing of goods?
What does the term 'opportunity cost' refer to?
What does the term 'opportunity cost' refer to?
Flashcards
Entrepreneur
Entrepreneur
A person who starts a business, taking on most of the risks for potential rewards.
Customer
Customer
A person who buys goods or services from a business.
Consumer Goods
Consumer Goods
Physical products (not durable) bought for personal use (e.g., food, clothing).
Private Limited Company
Private Limited Company
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Factors of Production
Factors of Production
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Secondary Sector
Secondary Sector
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Opportunity Cost
Opportunity Cost
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Public Sector
Public Sector
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Study Notes
Key Business Terms
- Entrepreneur: An individual with an idea for a new business, taking most of the risks, but also reaping most of the profits.
- Customer: An individual or organization buying goods or services from a business.
- Consumer goods: Physical goods sold for personal use, non-durable.
- Consumer services: Non-physical products sold to consumers, often not for resale.
- Factors of production: Resources needed to produce goods, such as raw materials, labor, and capital.
- Capital goods: Physical goods used in the production of other goods and services.
- Enterprise: Showing initiative to start a business, taking risks.
- Added value: Increasing the selling price of finished compared to bought-in inputs.
- Opportunity cost: The value of the next best alternative that is sacrificed when a choice is made.
- Multinational business: A business with headquarters in one country but operating branches in others.
- Intrapreneur: A business employee who directly takes responsibility for turning an idea into a new product or venture.
- Business plan: A document outlining a business's objectives, strategies, target market, and financial projections.
Types of Businesses
- Private limited company: A company whose shares are not traded on a stock exchange, typically owned by family members.
- Initial public offering (IPO): Offer to the public to buy shares in a private company.
- Public limited company (PLC): Shares traded on the stock exchange, publicly held.
- Primary sector: Businesses involved in extracting natural resources (farming, fishing, oil).
- Secondary sector: Businesses that process raw materials into finished goods (e.g., manufacturing, construction).
- Tertiary sector: Businesses providing services to consumers and other businesses.
- Quaternary sector: Businesses providing information and knowledge services.
- Public sector: Organisations accountable to and controlled by central or local government.
- Private sector: Businesses owned and controlled by individuals or groups.
- Mixed economy: Economic resources owned and controlled by both the public and private sectors.
- Free market: Economic resources largely owned by the private sector with minimal state intervention.
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Description
Test your understanding of essential business concepts with this quiz on key terms such as entrepreneur, customer, and opportunity cost. Ideal for students studying business fundamentals or anyone interested in enhancing their business vocabulary.
