1.1 Intro to Business Management

Question 1

Role of business

Answer 1

To combine human, physical, and financial resources to create goods and services

Question 2

Factors of Production

Answer 2

The initial inputs to the business activity consisting of land, labor, capital, and enterprise

Question 3

Land

Answer 3

All the physical space required to start up the business as well as renewable and non-renewable resources of nature

Question 4

Labor

Answer 4

The cumulative effort inputted into the business by the workforce, from unskilled workers and skilled employees

Question 5

Capital

Answer 5

The finances required for the business to function include machinery, equipment, and resources

Question 6

Enterprise

Answer 6

All factors of production are unified to carry out the entrepreneur’s idea of a successful business capable of producing and selling products for a profit

Question 7

Primary sector

Answer 7

The sector of business that engages in the extraction, farming, fishing, hunting, or mining of natural resources

Question 8

Secondary sector

Answer 8

The sector of business that manufactures and transforms the natural resources into products

Question 9

Tertiary sector

Answer 9

The sector of business that provides services to consumers and other businesses

Question 10

Quaternary sector

Answer 10

A subset of the tertiary sector that involves educational and knowledge-based services, concerned with generating and sharing information

Question 11

Entrepreneur

Answer 11

An individual who takes the financial risk of starting and managing a new business venture

Question 12

Intrapreneur

Answer 12

An individual employed by a large corporation who demonstrates entrepreneurial thinking in the development of new products

Question 13

Reasons for starting up a business

Answer 13

GET CASH
Growth
Earnings (potential rewards for selling products)
Transference and Inheritance (pass of assets to future generations)
Challenge (personal satisfaction)
Autonomy (working for oneself, self-imposed rules)
Security (job security being a business owner)
Hobbies (more motivated if they pursue something they are passionate about)

Question 14

Steps in starting a business

Answer 14

1. Write a business plan
2. Get startup capital
3. Get business registration
4. Hire employees
5. Market the business

Question 15

Problems faced by start-ups

Answer 15

Strong competition, lack of finance (cash flow problems), poor management skills, unestablished customer base, changes in the business environment

Question 16

Elements of a business plan

Answer 16

A written document that describes all the aspects of a new enterprise (business, market it plans on operating in, how the business will be funded, the number of employees, and the marketing strategy)