1.1.3 The role of business enterprise

Question 1

Land

Answer 1

somewhere to produce the goods e.g. a farm

Question 2

Labour

Answer 2

people to work in the business e.g. farm
workers

Question 3

Capital

Answer 3

money to get the business started

Question 4

Enterprise

Answer 4

This is the drive or motivation from the
owners to start a business

Question 5

entrepreneur

Answer 5

An entrepreneur
develops a business
idea and then hires and
organises the factors of
production to carry out
the business activity

Question 6

Risk taking

Answer 6

Setting up a
business is risky, money has
to be paid out in advance to
buy materials, equipment
and wages
There is no guarantee that
the final product or service
will be sold

The entrepreneur bears all
cost of the business fails

If an entrepreneur gives up a
regular job they will also lose
that income and have to
depend on the business to
pay their bills