1.2.1 - 1.2.5

Question 1

Creative destruction

Answer 1

Something that just fail in order to learn from it and make it work

Question 2

Innovation

Answer 2

Using other inventions to create something new that can be profited from

Question 3

Added value

Answer 3

Cost to make + what extra things happen

Question 4

Cost of production

Answer 4

How much money is spent on making products

Question 5

Investment

Answer 5

The purchase of goods that are not consumed today but are used in future to create wealth

Question 6

Incentives

Answer 6

A cost/benefit that motivates a decision or action by consumers, businesses, or other participants in the economy

Question 7

Profit

Answer 7

Total generated revenue by a business minus total opportunity costs

Question 8

Social entrepreneurs

Answer 8

The use of techniques by start up companies and other entrepreneurs to develop, fund and implement solutions to social, cultural, environmental issues

Question 9

Nonfinancial motives

Answer 9

A company uses methods to motivate employees without extra wages, compensation etc.

Question 10

Ethical motives

Answer 10

A company makes ethical changes to increase employee motivation

Question 11

Factors of production

Answer 11

Inputs used in production of goods or services in order to make economic profit

Question 12

Land

Answer 12

Area owned by business

Question 13

Labour

Answer 13

Workforce/motivation of workers

Question 14

Capital

Answer 14

Anything that can enhance a person’s power to perform economically useful work

Question 15

Enterprise

Answer 15

A project/undertaking that is especially risky or difficult

Question 16

Specialisation

Answer 16

Individuals/organisations focussing on a limited range of production tasks where they perform best

Question 17

Exchange

Answer 17

Transfer of goods or services by trading or other means

Question 18

Efficiency

Answer 18

Every resource is optimally allocated to serve each individual or entity in the best way while minimising waste and inefficiency

Question 19

Division of labour

Answer 19

Enables workers to focus on specific tasks which increases overall efficiency so long as there is sufficient volume/quantity produced

Question 20

Working capital

Answer 20

Where most people desire to work,

The place that often has the most job opportunities/highest paid jobs

Question 21

Interest rates

Answer 21

The amount that has to be paid by the borrower to the lender as an added percentage

Question 22

Income tax

Answer 22

Personal allowance where tax is free but applies to annual wage

Question 23

Corporation tax

Answer 23

Tax paid by businesses which is calculated as a percentage of the profit made

Question 24

VAT

Answer 24

Value Added Tax

20% of the value of sales to lessen the cost of manufacturers

Question 25

Skills shortage

Answer 25

Skilled individuals are employed by other businesses