Chapter 1 - Nature of Business Flashcards
What is the main role of a business?
The main role a business is produce/provide goods and services, to satisfy individuals’ wants and needs
What are the 8 other roles of business?
Profit, Employment, Incomes, Choice, Innovation, Entrepreneurship and risk, Wealth, and Quality of Life
- Profit - What is it?
Profit is what remains after all business expenses have been deducted from the business’s sales revenue.
What is revenue?
Revenue is the money a business receives as payment for its products.
What is operating expenses?
All the costs of running the business.
- Income - What is it?
Income is the money received for providing his or her labour.
What is a wage?
A wage is money received usually on an hourly or daily basis.
What is a salary?
A salary is a fixed regular payment, usually paid fortnightly or monthly, but is usually expressed as an annual sum.
What is a shareholder?
Shareholders are people who are part owners of a company because they own a number of shares.
What is a dividend?
A dividend is when a distribution of a company’s profit is divided among shareholders.
- Choice - What is it?
Choice is the act of selecting among alternatives
- Innovation - What is it?
Innovation is the process of creating an improved product, service or process, e.g. a new iPhone.
What is invention?
Invention is the de of something completely new.
What is Research and Development (R&D)?
R&D is a set of activities undertaken to improve existing products
- What is entrepreneurship?
Entrepreneurship is the willingness to start, operate and assume the risk of a business venture in the hope of making a profit.
