Business Studies Unit 1-Creating a business

Question 1

Describe what it means to be enterprising

Answer 1

To have have vision, energy, an initiative and the ability to take risks and develop a successful business idea.

Question 2

Name at least three key entrepreneurial characteristics displayed by successful business people.

Answer 2

Risk taking,innovation, decision making, determination, leadership, planning and persuasiveness

Question 3

Give three reasons why the government encourages enterprising

Answer 3

1. It reduces unemployment
2. New ideas may succeed and provide fresh opportunities
3. To raise taxes
4. Competition ensures a healthier business environment
5. People feel motivated by it

Question 4

Give three essential qualities and skills required by today’s workforce.

Answer 4

1. Employees must be able to accept change
2. Employees must be adaptable
3. Employees have to be flexible

Bonus*
Employees have to be able to work in teams

Question 5

Give three advantages if Risk taking

Answer 5

1. There is potential for a lot of profit
2. You can get ahead of competitors
3. You can become famous from your success

Question 6

Give three disadvantages of risk taking

Answer 6

1. There is chance that you could lose large amounts of money if your business fails
2. You could waste a lot of time from taking a risk and it failing
3. You could damage an established brand

Question 7

Explain the resource for a business: Land

Answer 7

Land refers to the land in which the business premises, houses, roads and farms are located. Land also refers to the oceans and all natural resources and raw materials which are contained either on or above the earth

Question 8

Explain the resource for a business: Labour

Answer 8

Labour refers the the human resource in the business- The workers employed to work for the business. They can provide physical labour or mental labour depending on the nature of the business.

Question 9

Explain the resource for a business: Capital

Answer 9

Capital includes the money which the owner invested in the business at the beginning, but also includes the items bought with the original investment- such as premises and machinery.

Question 10

Explain the resource for a business: Enterprise

Answer 10

Refers to the role of the entrepreneur to ensure that capital, land and labour are in correct proportions to run the business successfully.

Question 11

Give five reasons why a business would start up

Answer 11

1. To provide goods and services for their customers
2. A gap has been spotted in the market
3. Entrepreneur wants to be their own boss
4. To meet customers needs
5. To make money

Question 12

What do you call a business containing 1-9 employees?

Answer 12

A Micro business

Question 13

What do you call a business containing 10-49 employees

Answer 13

A small business

Question 14

What do you call a business containing 50-249 employees?

Answer 14

A medium business

Question 15

What do you call a business containing 250+ employees?

Answer 15

A large business

Question 16

Explain the meaning of the term public sector

Answer 16

Any business which is owned by the country (Government) as a whole and run on behalf of the people.

Question 17

Explain the term private sector

Answer 17

Any business which is owned by a private individual. The business’ top aim is usually to make profit.

Question 18

Explain the meaning of the term social enterprise.

Answer 18

Social enterprise is a business which has social aims and reinvests a large proportion of its profits into the community or back into entreprise. It’s primary aim is not to make maximum profit.

Question 19

Give 1 economic aim of a social enterprise, 1 social aim and one environmental aim.

Answer 19

Economic- To provide employment
Social-To provide a sense of community
Environmental- To look after the community and be have sustainable business practice.

Question 20

Describe and explain the following business aim-Survival

Answer 20

This aim is relevant when a business firsts opens up or during a recession. At times like this the business could reduce prices as low as possible to hold on to their customers or it may reduce expenditures to cut costs and improve cash flow

Question 21

Give three business aims that are generally in conflict

Answer 21

Profit vs concern for the environment
Profit vs social responsibility
To provide a service vs survival

Question 22

Give three reasons why aims and objectives are helpful to a business

Answer 22

1. They help the business to set clear targets
2. Business aims will help the business to plan ahead for the long-term.
3. Business aims will help the individual departments to set their own personal goals.

Question 23

Analyse the ethical issues associated with environmental issues

Answer 23

To be environmentally friendly means it may cost more meaning less profit for the business

Question 24

Analyse the ethical issues associated with employee working conditions

Answer 24

To ensure staff is treated fairly it means paying a higher wage and having good working conditions-this is costly to the business and reduces profit.

Question 25

Analyse the ethical issues associated with equality

Answer 25

Not to discriminate against any stakeholder means to treat everyone fairly and to have policies in place for good practice with their employees

Question 26

Analyse the ethical issues associated with social responsibility

Answer 26

To not break the law and be honest with all stakeholders and the local community. Not to have sweatshops. To give back to the local community may cost the business but it will raise their image.