chapter 1 People in Business

Question 1

When a business closes

Answer 1

1) employees lose jobs
2) customers have to go somewhere else
3) owner loses livelihood
4) suppliers lose sales
5) gvt loses taxes

Question 2

stakeholders

Answer 2

are all the ppl affected by how a business is run

Question 3

entrepreneurs

Answer 3

someone who takes on the personal and financial risk in order to make a profit.
They spot a gap in the market
takes initiative 
sets up a business
eg Bill Gates Microsoft

Question 4

investor

Answer 4

investor gives capital to the entrepreneur that they need to start their business in exchange for a return on the investment
the higher the risk the higher expected return
eg shareholders

Question 5

types of finance

Answer 5

debt capital from a bank has to be repaid

equity capital is part ownership shareholders

grants gvt aid

Question 6

manager

Answer 6

runs the business on a day-to-day basis and make sure it achieves it’s objectives
they use resources such as people, money, or equipment to make the business a success
a manager must lead, communicate, and motivate

eg Michael O Leary

Question 7

Producer

Answer 7

eg Stafford’s Bakery
turns raw materials into finished products
enters into contracts with suppliers
try to make a profit by keeping costs low and prices competitibe

Question 8

consumer

Answer 8

buys goods/ services from the entrepreneur for their own personal use
consumer gives a business a market and market research info

Question 9

supplier

Answer 9

provides raw materials needed for producers eg dairy farmers
compete for contracts
offer inducements like:
1) discounts
2) credit
3) prompt delivery
4) free delivery

Question 10

service providers

Answer 10

people or organisations that provide support services to the public or business
they dont make a finished products

Question 11

types of service providers

Answer 11

• financial institution
loans
current accounts

• insurance company
protection against losses

• solicitor
legal advice

• transport
delivery of goods in and out
eg DPD

Question 12

employer

Answer 12

person or organisation who hires people to work in return for a wage
respnsibilities: provide suitable working conditions
pay a fair wage

costs: wages, PRSI, insurance and facilities

Question 13

employees

Answer 13

people recruited by the employer to run the business
they get a reward called a wage or salary
they have rights eg minimum wage
safe and healthy working conditions
they have responsibilities- respecting authority and being punctual
intrapreneur is an employee who gives their employers ideas to make the business more successful

Question 14

government

Answer 14

changes in gvt laws or taxes can affect how a business is run- uses the revenue collected from tax to help run the country.
if a business is selling more products or making more profit then revenue increases
LEO’s IDAs enterprise Ireland

Question 15

interest groups

Answer 15

• wish to influence the political decision-making process but aren’t part of the accepted political structure of a country
• group of people who come together to campaign for a common goal
• put pressure on gvt or EU to accept their position on an issue
• eg trade unions IFA green peace

Question 16

lobbying and interest groups

Answer 16

• applying pressure to the decision maker to persuade them to make the decision that the interest group wants
• lobby politicians to bring out laws
• organise negative publicity
• boycott businesses

Question 17

ICTU

Answer 17

Irish Congress of Trade Unions

Question 18

IBEC

Answer 18

Irish Business and Employer’s Confederation

Question 19

CAI

Answer 19

Consumer Association Ireland

Question 20

ICMSA

Answer 20

Irish Creamery Milk Supplier’s Association

Question 21

IFA

Answer 21

Irish Farmer’s Association

Question 22

CIF

Answer 22

Construction Industry Federation

Question 23

co-operative relationship

Answer 23

win win
to co-operate means to act in a manner which is of mutual benefit to all concerned
same objective so work together to achieve goals
produces better results

Question 24

competitive relationship

Answer 24

one party wants to be more successful
one stakeholder benefits at the other party’s expense
win lose
Ryanair and Aer Lingus

Question 25

co-operative

Purchasing manager and supplier

Answer 25

supplier gets loyalty from increased credit period

purchasing manager more time to pay off their debts

Question 26

co-operative

gvt and entrepreneur

Answer 26

gvt invests in exports increasing revenue

entrepreneur receive capital from enterprise ireland

Question 27

co-operative
employer
employee

Answer 27

employee had a temporary wage cut but keeps their job in the long run

employer helps the business survive by paying less in wages

Question 28

co-operative

producer and producer

Answer 28

could both encourage consumption of their similar goods

2 rival car manufacturers share the cost of a new manufacturing plant

Question 29

competitive relationship

investor and entrepreneur

Answer 29

investor wins getting a higher return through dividends

entrepreneur loses a higher percentage of their profits

Question 30

competitive

employee and employer

Answer 30

employee negotiates a higher wage due to a higher cost of living

employer faces higher wage costs and lose profit

Question 31

competitive relationship

producer and producer

Answer 31

both pursue mutually exclusive goals at the expense of the other parties
eg Volkswagen and Renault
compete on the quality price customer service and choice of g/s

Question 32

competitive relationship

entrepreneur and gvt

Answer 32

business lobbied for lower corp tax

gvt gets less revenue

Question 33

dynamic relationship

Answer 33

between stakeholders are constantly changing
sometimes co-operative
sometimes competitive
people’s role may also change

Question 34

benefits of competitive

Answer 34

consumer benefits from 2 producers competing on
• lower prices
• increased choice
• increased quality
• better customer service