1.1.3 The role of business enterprise

Question 1

To produce goods and services 4 things are needed

Answer 1

Land – somewhere to produce the goods e.g. a farm

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

Capital – money to get the business started

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

Question 2

Ways to add value

Answer 2

Design

USP

Quality

Branding

Convenience

Question 3

An entrepreneur is

Answer 3

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

Question 4

Enterprise

Answer 4

taking risks, being
creative and innovative
and using your initiative

Question 5

added value

Answer 5

Added value – the difference between what a business pays
its suppliers, and the price it is able to charge for its product
or service

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