NATURE OF BUSINESS - Role of business

Question 1

business

Answer 1

the organised effort of individuals to produce and sell, for a profit, the products that satisfy individuals’ needs and wants.

Question 2

choice

Answer 2

the act of selecting among alternatives

Question 3

dividend

Answer 3

a distribution of a company’s profits (either yearly or half-yearly) to shareholders that is calculated as a number of cents per share

Question 4

entrepreneur

Answer 4

someone who starts, operates and assumes the risk of a business venture in the hope of making a profit

Question 5

entrepreneurship

Answer 5

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

Question 6

finished product

Answer 6

one that is ready for consumers to buy and use

Question 7

goods

Answer 7

items that can be seen or touched

Question 8

income

Answer 8

money received by a person for providing his or her labour, or a business from return on its investment

Question 9

innovation

Answer 9

either creating a new product, service or process, or significantly improving an existing one

Question 10

operating expenses

Answer 10

all the costs of running the business except the cost of goods sold

Question 11

product

Answer 11

a good or service that can be bought or sold

Question 12

production

Answer 12

refers to those activities undertaken by the business that combine the resources to create products that satisfy customers’ needs and wants

Question 13

profit

Answer 13

what remains after all business expenses have been deducted from sales revenue

Question 14

quality of life

Answer 14

refers to the overall wellbeing of an individual, and is a combination of both material and non-material benefits

Question 15

research and development (R&D)

Answer 15

a set of activities undertaken to improve existing products, create new products and improve production

Question 16

revenue

Answer 16

the money a business receives as payment for its products

Question 17

risk

Answer 17

refer to the possibility of losses

Question 18

salary

Answer 18

a fixed regular payment, usually paid on a fortnightly or monthly basis but often expressed as an annual sum, made to a permanent employee of a business

Question 19

services

Answer 19

things done for you by others

Question 20

shareholders

Answer 20

people who are part of owners of a company because they own a number of shares

Question 21

wage

Answer 21

money received by workers, usually on a hourly or daily basis, for services they provide to an employer