Entrepreneur

Question 1

break-event point

Answer 1

The minimum sales revenue or total units sold needed for a business to be able to cover its own expenses and begin to make a profit

Question 2

cash flow forecast

Answer 2

process of estimating the cash that will be coming into a business and that will be flowing out of business during the same period of time.

Question 3

debt financing

Answer 3

obtaining funds to start or operate a business by borrowing money that has to be paid back to a lender. The entrepreneur is responsible for paying back the debt and interest even if there is no profit. The lender typically has no ownership in the buisness

Question 4

demand

Answer 4

the quantity of a good or service buyers and willing to purchase at various prices.

Question 5

equity financing

Answer 5

Obtaining funds to start or operate a business by selling shares of ownershi[ in the business; equity investors share in the profits.

Question 6

expense

Answer 6

Products costs plus operating expenses.

Question 7

interest

Answer 7

Price being paid to the lender for using his or her money.

Question 8

loss

Answer 8

Total expenses minus total revenue. When revenue is less.

Question 9

Market price

Answer 9

That price at which the quantity that buyers are willing to buy is equal to the quantity that sellers are willing to supply.

Question 10

operating expenses

Answer 10

Costs that are required to cover the basic, ongoing operation of the business such as rent, advertising, and utilities. For the production of goods, operating expenses do not include product costs.

Question 11

Opportunity cost

Answer 11

The next best alternative use given up when resources are used for an item of activity.

Question 12

Product costs

Answer 12

Usually refers to the cost of the actual materials and labor used to produce the goods that are sold to customers. Also called costs of goods sold.

Question 13

Profit

Answer 13

Total revenue minus total expenses, over a period of time, when total revenue is greater than the total expenses; this is the net income a business has earned over that period of time, after covering all expenses.

Question 14

Revenue

Answer 14

Total dollar amount a business receives from the sale of its goods or services over a particular period of time.

Question 15

Start-up costs

Answer 15

Total amount of money needed to get a business up and running.

Question 16

supply

Answer 16

The quantity of a good or service sellers are willing to supply at various prices.

Question 17

Target market

Answer 17

A smaller portion of the overall main customer group for a particular business or industry. This smaller group is made of potential customers who are believed to be most likely to purchase the good or service offered by the entrepreneur.