2.6 The Competetive Environment

Question 1

Markets

Answer 1

Exist where there are buyers and sellors

Question 2

Competition

Answer 2

Exists when more than one business is attempting to attract the same customers

Question 3

Monopoly

Answer 3

Exists when a business does not face any competition in a particular market

Question 4

Market share

Answer 4

Is the percentage of sales in a particular market recorded by a business

Question 5

Uncertainty

Answer 5

Occurs where there is a lack of information about a situation. This means the outcome or consequences are very difficult to predict.

Question 6

Risk

Answer 6

The possibility of something going wrong

Question 7

Business plan

Answer 7

A document setting out what a business does and what it hopes to achieve in the future.

Question 8

Diversification

Answer 8

Occurs when a business starts selling new products in new markets.

Question 9

Recession

Answer 9

Occurs when the value of an economy’s output of goods and services falls for six months or longer.

Question 10

Entrepreneur

Answer 10

Someone who is willing to take the risks involved in starting a new business.