Enterprise Flashcards
1
Q
Define rent of ability.
A
Rent of ability is the extra profit an entrepreneur earns because of their extra business ability.
2
Q
Define insurable risks.
A
Insurable risks are those risks which can be mathematically estimated. Therefore the entrepreneur can insure against them.
3
Q
Define non-insurable risks.
A
Non-insurable risks are those risks which the entrepreneur cannot insure against or cover financially.
4
Q
Define enterprise.
A
Enterprise is the factor of production which takes the initiative to bring the other factors into productive units and thus it bears the risk involved in production.
