1.5 entrepreneurs

Question 1

What are the three roles of an entrepreneur?

Answer 1

-Make business decisions
-Create and set up a business
-Running and expanding a business

Question 2

What are some examples of characteristics an entrepreneur should have?

Answer 2

-Financial skills
-Persuasive
-Problem-solving skills
-Creative
-Risk taker

Question 3

What is intrapreneurship?

Answer 3

Promotion of entrepreneurial thinking and behaviour within a business

Question 4

What is the role of an intrapreneur?

Answer 4

They work within a large organisation and think creatively, willing to take risks to innovate for the business

Question 5

What are two advantages of promoting intrapreneurship within a business?

Answer 5

-New products are likely to be developed
-Increases motivation

Question 6

What are four barriers to entrepreneurship?

Answer 6

-access to finance
-lack of know-how
-fear of failure
-entrepreneural capacity

Question 7

What is entrepreneurial capacity?

Answer 7

refers to an individual’s ability to think creatively, take risks and identify business opportunities

Question 8

What is the difference between uncertainty and risk?

Answer 8

Risk can be calculated for but uncertainties cannot

Question 9

What are three reasons why a person would set up a business?

Answer 9

-profit maximisation
-independence
-social entrepreneurship

Question 10

What would be a common business objective for a startup company?

Answer 10

survival and enough cash inflow to keep themselves in business

Question 11

What may be a business objective for an established business?

Answer 11

Profit maximisation, making the most amount of profit in the least amount of time

Question 12

What are three other business objectives?

Answer 12

-Market share
-Cost efficiency
-Sales maximisation

Question 13

What is a sole trader?

Answer 13

A business that has a single owner

Question 14

What are the advantages of being a sole trader?

Answer 14

-Owner has complete control
-All profits belong to the owner
-Easy and inexpensive to set up

Question 15

What are the disadvantages to being a sole trader?

Answer 15

-Unlimited liability
-Limited access to funds and capital
-Limited skill sets as it is only you

Question 16

What is a partnership?

Answer 16

Two or more people join together to form a business

Question 17

What are the advantages of a partnership?

Answer 17

-easy and inexpensive to set up
-shared responsibilities
-More skills and knowledge available

Question 18

What are the disadvantages of a partnership?

Answer 18

-Unlimited liability
-Potential for dispute against partners
-Profits are shared

Question 19

What is a Private limited company (LTD)?

Answer 19

The ownership of the business is broken down into a specified number of shares sold by the owner usually to friends and family

Question 20

What are the advantages of LTDs?

Answer 20

-Limited liability
-Access to greater finance and capital due to shares being sold
-Can have a professional image and reputation

Question 21

What are the disadvantages of a LTD?

Answer 21

-More expensive and time consuming to set up
-More complex legal requirements and regulations
-Banks may not give access to loans as the business can not pay their debts

Question 22

What is unlimited liability?

Answer 22

The owner is personally responsible for any debts the business incurs

Question 23

What is franchising?

Answer 23

Where a franchisee buys the rights to operate a business with a franchisors brand name

Question 24

What is a social enterprise?

Answer 24

A business that has the primary purpose to create social or environmental impacts where profits are usually invested back into the business

Question 25

What are lifestyle businesses?

Answer 25

Small, owner-operated businesses that prioritise a specific lifestyle of the owner over profits

Question 26

What is a public limited company (PLC)?

Answer 26

A business that allows its shares to be sold on the stock market.

Question 27

What are three advantages of becoming a PLC?

Answer 27

-Lots of capital can be raised quickly
-Risk is spread over a larger group of shareholders
-Greater public profile where they can attract new consumers

Question 28

What is an opportunity cost?

Answer 28

The loss of the next best alternative when making a decision

Question 29

What is a trade off?

Answer 29

Having more of one thing means having less of another

Question 30

What are the skills of a leader?

Answer 30

-Inspring
-Strategist
-Reassurer

Question 31

What are some difficulties when moving from entrepreneur to leader?

Answer 31

-Learning to listen
-The need to delegate responsibilities
-Trusting employees