Business Mocks 1

Question 1

What is the primary purpose of most businesses?

Answer 1

To produce goods or provide services to meet customer needs.

Question 2

Define a need and a want.

Answer 2

A need is something essential for survival, like food; a want is something desirable but not essential, like a holiday.

Question 3

What is the difference between a good and a service?

Answer 3

A good is a physical product, whereas a service is an intangible action provided.

Question 4

Name two types of private sector business ownership.

Answer 4

Sole trader and private limited company (Ltd).

Question 5

What is one advantage of being a sole trader?

Answer 5

The owner keeps all the profits.

Question 6

What does ‘limited liability’ mean for shareholders?

Answer 6

Shareholders are only liable for the amount they have invested in the business.

Question 7

What is one method a business can use to grow internally?

Answer 7

Opening new stores or launching new products.

Question 8

What is a benefit of merging with another business?

Answer 8

Increased market share and resources.

Question 9

What is one risk of expanding too quickly?

Answer 9

Cash flow problems or losing control of operations.

Question 10

What happens to consumer spending during a recession?

Answer 10

It generally decreases.

Question 11

Name one way a rise in unemployment might affect a business.

Answer 11

Lower demand for luxury goods.

Question 12

What is inflation?

Answer 12

The rate at which the general price level of goods and services rises over time.

Question 13

What does globalisation mean?

Answer 13

The increasing interconnectedness of countries through trade, investment, and technology.

Question 14

Name one advantage of globalisation for a business.

Answer 14

Access to larger markets and cheaper resources.

Question 15

What is one challenge globalisation might bring?

Answer 15

Increased competition from international businesses.

Question 16

Name the three main types of production processes.

Answer 16

Job, batch, and flow production.

Question 17

What is an advantage of using flow production?

Answer 17

High efficiency and lower unit costs.

Question 18

Which type of production is best for custom-made products?

Answer 18

Job production.

Question 19

What does procurement mean?

Answer 19

The process of acquiring goods and services a business needs from suppliers.

Question 20

Name one factor a business should consider when choosing a supplier.

Answer 20

The cost of the supplier’s goods or services.

Question 21

What is the impact of poor-quality suppliers on a business?

Answer 21

It can lead to delays and customer dissatisfaction.

Question 22

Why is quality important in a business?

Answer 22

It affects customer satisfaction and loyalty.

Question 23

What does TQM stand for?

Answer 23

Total Quality Management.

Question 24

Name one benefit of quality control.

Answer 24

It ensures defective products are identified before reaching customers.

Question 25

What is one feature of good customer service?

Answer 25

Responding quickly to customer complaints.

Question 26

Name one benefit of providing excellent customer service.

Answer 26

It can increase customer loyalty and repeat purchases.

Question 27

What is the impact of poor customer service on a business?

Answer 27

It can lead to bad reviews and loss of customers.

Question 28

What is meant by a flat organisational structure?

Answer 28

A structure with few levels of hierarchy and wider spans of control.

Question 29

What is one advantage of a hierarchical structure?

Answer 29

Clear lines of authority and accountability.

Question 30

Define ‘span of control.’

Answer 30

The number of employees a manager is directly responsible for.