Entrepreneurship

Question 1

Define an ENTREPRENEUR

Answer 1

An entrepreneur is someone who spots an opportunity to start a new business and shows initiative and willingness to take risks in order to benefit from the potential reward.

Question 2

Define a BUSINESS OPPORTUNITY COST

Answer 2

A business opportunity cost is the cost of one course of action in terms of the next best alternative forgone.

Question 3

Define a TRADE OFF

Answer 3

A trade off is accepting one thing in order to gain more of something else.

Question 4

What are examples of entrepreneurial motives?

Answer 4

• Higher income/profit
• Independence
• Flexibility
• Ethical or social reasons
• Profit maximisation
• Profit satisficing

Question 5

What are the typical characteristics of entrepreneurs?

Answer 5

• Hard working
• Resilient
• Self confident
• Creative
• Resourceful
• Unafraid to take risks

Question 6

What are the typical skills of entrepreneurs?

Answer 6

• Organisation
• Problem solving
• Communication
• Numeracy
• IT
• Team working

Question 7

Define INTRAPRENEURSHIP

Answer 7

Intrapreneurship is when employees within large organisations show the same skills and act in the same way as entrepreneurs.

Question 8

Define an INTRAPRENEUR

Answer 8

An intrapreneur is an employee who uses entrepreneurial skills, without having to risk their own money, to find and develop initiatives that will have financial benefit for their employers.

Question 9

What are the benefits of intrapreneurship?

Answer 9

• They help the business to grow
• Give the business a competitive advantage
• Have the right mindset and skills to help employees deal with change
• Allowing individual employees to be creative can increase motivation

Question 10

How can a business encourage intrapreneurship?

Answer 10

• Give employees responsibility
• Make risk taking and failure acceptable
• Train employees to be innovative
• Encourage networking and collaboration
• Reward entrepreneurial thinking and activity.

Question 11

What are the roles of an entrepreneur?

Answer 11

1. Creating and setting up a business –> idea, research, business plan, financing, location/resources and launch.
2. Running and expanding the business –> producing the good, managing stock, managing employees, marketing, managing finances.
3. Anticipating risk and uncertainty within the business environment –> carry out market research, avoid investments with low success, choose investments with high success.

Question 12

What are the barriers to entrepreneurship?

Answer 12

• Access to finance
• Lack of entrepreneurial capacity/know how
• Unwillingness to take risks
• Lack of ideas

Question 13

Define a LEADER

Answer 13

A leader is a senior member of an organisation with the ability to influence and direct other members in order to achieve the goals of the group.

Question 14

How does an entrepreneur move to a leader?

Answer 14

• Must learn to delegate
• Learn to effectively listen
• Keep an open mind
• Trust their workforce
• Be less reactive and more considerate in their approach

Question 15

What environments should entrepreneurs analyse?

Answer 15

P olitical 
E nvironmental
S ocial 
T echnological
L egal 
E conomical