Component 1 - Enterprise Flashcards
Explain : What is meant by the term Enterprise?
One of the factors of Production
Explain : What is meant by the term SME?
Small to medium enterprise,
Employing under 250 people and Turning over less that £50 million,
They employee 44% of the UK workforce
Explain : what are Business Opportunities ; where do they exist.
Business opportunities exist when a MARKET NEED has not been yet been provided or is yet to be targeted efficiently.
Explain : What is an entrepreneur?
An entrepreneur is someone who setups and runs a business in order to fulfil a gap in the market.
Explain : Name 4 Financial and non Financial methods of motivation for Entrepreneurs.
Financial
1 - To make a Profit
2 - To be Financially independent
Non - Financial
1 - To be their own boss
2 - To solve ethical and moral problems (charity)
Explain : Name 3 characteristic’s of an Entrepreneur.
1 - Risk taking/managing
2 - Innovative
3 - Organised and hard working
Explain the importance of Entrepreneur to the economy
Entrepreneurship could be seen as a shift of resources from an area of low productivity into one with higher productivity and yield.
This means they can add value that did not exist before to the economy and benefit everyone.
Evaluate : The impact of Entrepreneurs and SMEs on the UK Economy.
On the One Hand (for SMEs and Entrepreneurs)
1 - Job Creation
Provide employment through organisation of resources —> 44% of UK economy employed by SMEs
2- Provide competition and innovation to economy.
More smaller firms (more competition )—> greater innovation = greater benefit for the economy
On the Other Hand ( For Larger businesses)
1 - More resilient to Economic downturn than SMEs (as they have more cash reserves)
Lower U/E during downturn
2 - Economies of scale
They can output more efficiently at a lower cost
THINK OF FURTHER CHAIN OF REASONING AND A HOWEVER FOR EACH POINT
