1.5 Entrepreneurs and leaders

Question 1

What is an entrepreneur?

Answer 1

A person who is willing and able to create a new business idea or invention and takes risks in pursuing success.

Question 2

What are the key activities of entrepreneurs?

Answer 2

• Organise resources
• Make business decisions
• Take risks

Question 3

What does it mean to organise resources in entrepreneurship?

Answer 3

Gathering and coordinating the necessary resources to start and operate a business.

Question 4

Provide an example of organising resources.

Answer 4

When Michael Dell started his computer company from his garage, he organised space, computers, software tools, and employees.

Question 5

What is the importance of decision-making for entrepreneurs?

Answer 5

Decisions determine the success or failure of the business.

Question 6

Fill in the blank: Entrepreneurship involves taking _______.

Answer 6

[risks]

Question 7

Give an example of risk-taking in entrepreneurship.

Answer 7

Investing life savings into a new venture or quitting a secure job to start a business.

Question 8

What is intrapreneurship?

Answer 8

The practice of promoting entrepreneurial thinking and behaviour within an existing business.

Question 9

How does intrapreneurship benefit a business?

Answer 9

It allows businesses to tap into the creative potential of employees and generate new products, services, or processes.

Question 10

What is the ‘20% time’ policy at Google?

Answer 10

A policy that allows employees to spend 20% of their work time on personal projects.

Question 11

What was developed under Google’s ‘20% time’ policy?

Answer 11

Gmail, a free email service.

Question 12

What barriers can prevent individuals from starting a successful business?

Answer 12

• Lack of entrepreneurial capacity
• Lack of access to finance
• Lack of training/know-how
• Fear of failure/lack of confidence

Question 13

Define entrepreneurial capacity.

Answer 13

An individual’s ability to think creatively, take risks, and identify and seize business opportunities.

Question 14

True or False: Uncertainty is caused by factors within the entrepreneur’s control.

Answer 14

False

Question 15

What is the difference between risk and uncertainty?

Answer 15

Risk is something an entrepreneur can plan for, while uncertainty is caused by factors outside of their control.

Question 16

What are 5 skills required by entrepreneurs

Answer 16

Communication

Teamwork

problem solving

organisation

Numeracy

Question 17

What are characteristics required by an entrepreneur

Answer 17

Creativity

Hard working

Resilience

Initiative

Self confidence

Risk taker

Question 18

What are the two common financial reasons people set up a business

Answer 18

Profit maximisation

Profit satisfaction

Question 19

Why do people set up businesses for profit maximisation

Answer 19

People want to generate substantial revenue and profit

Question 20

Why do people set up businesses for profit satisfaction

Answer 20

Is not solely focused on maximising profits but rather a satisfactory level

Question 21

What are non financial reasons for someone to start a business

Answer 21

Ethical stance

social entrepreneurship - seek to address a social or environmental problem

Independence- be their own boss and have control over their work

Home working

Question 22

What is the aim of most start up businesses

Answer 22

Survive the initial entry into the market

Question 23

What are likely business objectives

Answer 23

Profit maximisation

sales maximisation

market share

cost efficiency

employee welfare

customer satisfaction

social objectives

Question 24

What is a sole trader

Answer 24

A firm that has a single owner who makes all the decisions and gets to keep all of the profits.

owner is legally responsible for all debts of the business

Question 25

What is meant by limited liability

Answer 25

A legal structure in which the assets of the owners are considered to be separate to those of the business

Question 26

What are the advantages of sole traders

Answer 26

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

Question 27

What are the disadvantages of a sole trader

Answer 27

Responsible for any debts the business incurs limited access to finance Limited skill set of the single business owner

Question 28

What is a partnership

Answer 28

Two or more people join together to form a business

Question 29

What are the advantages of a partnership

Answer 29

Easy and inexpensive to set up shared responsibility and decision making more skills and knowledge available increased access to finance and capital

Question 30

Disadvantages of a partnership?

Answer 30

Partners have unlimited liability potential disputes between partners profits are often shared equally no matter the contribution difficult to transfer ownership

Question 31

What is meant by unlimited liability

Answer 31

The business owner or owners are personally responsible for all of the debts of the business, no matter the value

Question 32

What is a Private limited company

Answer 32

Ownership is broken down into a specified number of shares Decision making often rests with the person appointed CEO (LTD)

Question 33

What are advantages of a private limited company

Answer 33

Limited liability (owners are not personally responsible for the company's debt) Access to greater finance and capital Easier to transfer ownership professional image and rep

Question 34

What are the disadvantages of a private limited company

Answer 34

More expensive and time consuming to set up More complex legal requirements and regulations annual financial reporting and auditing is required Shareholders have little control over the company. Founder usually imposes their agenda

Question 35

What is a franchise

Answer 35

An individual buys the rights to operate a business model and branding of a larger company in exchange for large fees e.g. mcdonalds

Question 36

What is a social enterprise

Answer 36

A business with the primary purpose to create social or environmental impact

Question 37

What is a public limited company

Answer 37

a company that is able to offer its shares to the public. Operate on the stock exchange

Question 38

What are the advantages to becoming a PLC

Answer 38

Significant amounts of capital can be raised Risk is shared among a larger group of shareholders Increased liquidity, easier to buy and sell shares Greater public profile due to operating on the stock exchange Limited liability

Question 39

Disadvantages of beinig a PLC

Answer 39

Expensive to set up more complex accounting and reporting requirements greater risk of hostile takeover shareholders expect a dividend Shareholders may clash

Question 40

What is an opportunity cost?

Answer 40

The loss of the next best alternative when making a decision

Question 41

What is a trade off

Answer 41

When two things cannot be fully achieved

Question 42

Can every entrepreneur be a successful CEO?

Answer 42

Usually not, the skills required for a CEO are different to those required for an entrepreneur

Question 43

What are difficulties entrepreneurs face when transitioning to becoming a CEO of a growing business

Answer 43

They need to learn how to delegate tasks and responsibilities, use to doing it all themselves Being able to trust your team Learning to listen and having an open mind to new ideas Being less reactive and more strategic