chapter 1 enterprise

Question 1

entrepreneur

Answer 1

an individual who has the idea for a new business, starts it up and carries most of the risks but benefits from the rewards.

Question 2

customer

Answer 2

an individual consumer or organisation that purchases goods or services from a business.

Question 3

consumer

Answer 3

an individual who purchases goods and services for personal use.

Question 4

consumer goods

Answer 4

the physical and tangible goods sold to consumers that are not intended for resale. these include durable consumer goods. example : cars, washing machines. the non-durable consumer goods, such as foods and drinks that can only be used once.

Question 5

consumer services

Answer 5

the non tangible products sold to consumers that are not intended for resale. these include hotel accommodation, insurance services and train journeys.

Question 6

factors of production

Answer 6

the resources needed by businesses to produce goods and services.

Question 7

land

Answer 7

this general term includes not only land itself but all the renewable and non-renewable resources of nature, such as coal, crude oil and timber.

Question 8

labour

Answer 8

manual and skilled labour make up the workforce of the business.

Question 9

capital

Answer 9

its not just the finance needed to set up a business and pay for its continuing operations, but also all the manufactured resources used in production. these include capital goods, such as computers, machines, factories, offices and vehicles.

Question 10

capital goods

Answer 10

the physical goods used by industry to aid in the production of other goods and services, such as machines and commercial vehicles.

Question 11

enterprise

Answer 11

the action of showing initiative to take the risk to set up a business.
this is the initiative and coordination provided by risk-taking individuals called entrepreneurs. they combine the other factor of production into a unit capable of producing goods and services. enterprise provides the managing, decision-making and coordinating roles.

Question 12

adding value

Answer 12

increasing the difference between the cost of bought-in inputs (materials) and the selling price of the finished goods.

Question 13

added value

Answer 13

the difference between the cost of purchasing bought-in inputs and the selling price of the finished good.

Question 14

branding

Answer 14

the process of differentiating a product by developing a symbol, name, image or trademark for it.

Question 15

opportunity cost

Answer 15

the next most desired option that is given up.

Question 16

multinational business

Answer 16

a business organisation that has its headquarters in one country, but with operating branches, factories and assembly plants in other countries.

Question 17

intrapreneur

Answer 17

a business employe who takes direct responsibility for turning an idea into a profitable new product or business venture.

Question 18

business plan

Answer 18

a written document that describes a business, its objectives, its strategies, the market it is in and its financial forecasts.