Points Test 1 (booklet 1) Flashcards
Define the term entrepreneur
An entrepreneur in someone who starts and runs a business making and selling goods or providing a service
State 3 key characteristics of an entrepreneur
Risk taking, decision maker, innovative
State 3 motives of becoming an entrepreneur
Financial gain. Independance. Lack of job opportunities
State 3 motives of becoming an entrepreneur
Financial gain. Independance. Lack of job opportunities
State one reason entrepreneurs are important to uk economy
They create lots of jobs in their business which puts money into the economy
State one reason entrepreneurs are important to the businesses
They are important to their own business as they run it. And they’re important to other business as they can become competition
Define the term primary/secondary/tertiary sector
Primary: extraction of raw materials
Secondary: turns raw materials into goods
Tertiary: provides services to people
State a reason for decline in primary sector
Their jobs can easily be replaced by robots.
State a reason for a decline in the secondary sector
Increase is machines taking over their jobs as you don’t have to pay machines
State one reason for an increase in the tertiary sector.
As a country becomes more economically developed, there is much demand for services such as healthcare, tourism etc
State one stakeholder and their main interest in the business
Shareholder- success of the business to see a profit come back to themself
Define the term business plan.
A statement that outlines the way a business will achieve it’s objectives
State 3 items that would be included in a business plan
Operations, financial, marketing
State two sources of information and guidance that is available to entrepreneurs.
Banks give out info and advice. So can family and friends.
Define the term public sector
Organisations funded by local or national governments
State 3 aims of private sector businesses.
Profit, survival, increase share value
Define the term private sector
Organisations made by private individuals
State 3 aims of public sector businesses
Improving standards of life
Grow uk economy
Allow people to live safely
Define the terms, public good and merit goods
Public goods- goods that are non rival and non excludable
Merit goods- gov provided as if left to they’d go under consumed
Define the terms:
Sole trader
Partnership
Ltd
PLC
Sole trader: owned by one person
Partnership: between 2-20 people own a business
Ltd: exist separately from owners. The business has a separate legal identity
PLC: often family business need 50k capital to start.
Define the terms unlimited liability
Business owners are legally liable for any debt their company owes.
State 3 items included in a deed of partnership
Capital share, profit share, procedures for ending partnership
Define the term limited liability
Business owners can only lose what they have put into their business
Define the terms memorandum and articles of association
Memorandum: gives details of company
articles of association: details of running of company
