Chapter Two - Small Business Decision Making

Question 1

What is demand?

Answer 1

The quantity of a product that consumes that consumers are ready to purchase.

Question 2

What is market research?

Answer 2

A process of systematically collecting, recording and analysing information concerning a specific market.

Question 3

What is market conditions?

Answer 3

The features of a market into which a new product or service is to be introduced; they include factors such as the number of potential customers, level of competition and potential of growth.

Question 4

What is innovation?

Answer 4

Creating a new product, service or process, or significantly improving an existing one.

Question 5

What is research and development?

Answer 5

A set of activities undertaken to: improve existing products, create new products and improve production.

Question 6

What is entrepreneurship?

Answer 6

The ability and willingness to start, operate and assume the risk of a business venture in the hope of making a profit.

Question 7

What is business entity?

Answer 7

Any organisation engaged in the production of goods and services.

Question 8

What is incorporated business?

Answer 8

A business that has a separate legal entity from the owner(s).

Question 9

What is a sole trader?

Answer 9

A business owned and operated by one person.

Question 10

What is unlimited liability?

Answer 10

When the business owner is personally responsible for all the debts of his or her business.

Question 11

What is a partnership?

Answer 11

An unincorporated legal business structure with a minimum of two and a maximum of 20 owners.

Question 12

What is a silent partner?

Answer 12

One who contributed financially to the business but takes no part in such a way that the broader social welfare of the community is taken into consideration when making business decisions.

Question 13

What is incorporation?

Answer 13

The process that a business goes through to become a registered company and a separate legal entity.

Question 14

What are shareholders?

Answer 14

The owners of a company.

Question 15

What is limited liability?

Answer 15

When the shareholders in a company cannot be held personally responsible for the debts of that business.

Question 16

What is a proprietary company?

Answer 16

An incorporated business with a minimum of two, and a maximum of 50, private shareholders (also a private company).

Question 17

What is a solicitor?

Answer 17

An attorney who advises clients on legal matters, represents clients in certain lower courts, and prepares cases for barristers to present in the higher courts.

Question 18

What is an accountant?

Answer 18

It is a systematic process of identifying, recording, measuring, classifying, verifying, summarising, interpreting and communicating financial information. It reveals profit or loss for a given period, and the value and nature of a firm’s assets, liabilities and owners’ equity.

Question 19

What is business enterprise centres (BEC) Australia?

Answer 19

BEC Australia is a not-for-profit organisation whose primary role is to support and grow the national network of Business Enterprise Centres and provide representation on behalf of its members to key stakeholders.

Question 20

What is chambers of commerce?

Answer 20

A local association to promote and protect the interests of the business community in a particular place.

Question 21

what is the Victorian employers chamber of commerce and industry (VECCI)?

Answer 21

The Victorian Chamber of Commerce and Industry is the peak body for business in Victoria, informing and servicing more than 15,000 members, customers and clients around the State.

Question 22

What is the small business association of Australia and New Zealand?

Answer 22

The Small Enterprise Association of Australia and New Zealand (SEAANZ) is a not-for-profit organisation committed to the advancement, development and understanding of small enterprise within Australia and New Zealand.

Question 23

What is the Federal government?

Answer 23

A federal government is a system that divides up power between a strong national government and smaller local governments.

Question 24

What is the State government?

Answer 24

A state government is the government of a country subdivision in a federal form of government, which shares political power with the federal or national government.

Question 25

What is the Local government?

Answer 25

The lowest tier of government.

Question 26

What are informal networks?

Answer 26

A network of communications with no structure.

Question 27

What is business ethics?

Answer 27

The standards that define what acceptable and unacceptable behaviour that apply to business.

Question 28

What is socially responsible management?

Answer 28

Involves the leaders in an organisation to take steps to ensure that the broader social welfare of people and the environment is taken into consideration in business dealings.

Question 29

What are stakeholders?

Answer 29

Stakeholders are individuals or groups with an interest in the success of the business.