Reasons for starting a business Flashcards
What is Wealth Creation?
Wealth is increased through income, business profits, and investments in capital such as buildings, inventory, and equipment.
Wealth can also be created from the reputation and goodwill of a business.
Define Goodwill in a business context.
Goodwill is an intangible asset associated with the purchase of one company by another, specifically the difference between the purchase price and the fair market value of net assets acquired.
Goodwill reflects the business’s reputation and customer relationships.
What is one benefit of starting a business related to employment?
Creates employment opportunities and choices.
Business ownership allows for greater flexibility and freedom to pursue personal goals.
How does Financial Security relate to business ownership?
Business owners can achieve greater wealth and profit than employees if their business is successful.
This security benefits owners and their families.
Who is an Entrepreneur?
A person who organizes a business, takes on financial risks, and provides leadership to get the business going.
Entrepreneurs are critical for innovation and economic growth.
What does Innovation mean in a business context?
Making new changes to something established, introducing new methods, ideas, or products.
Innovation can lead to increased competitiveness and market relevance.
How can business owners impact their community?
By creating employment, providing economic growth, and offering goods and services that enhance quality of life.
Community involvement can strengthen local economies.
List three benefits of a business to the community.
- Sponsorship of community events
- Donations of equipment, products, and materials
- Contributions of time and expertise
Fill in the blank: A business can enhance its public image by _______.
[sponsoring community events, donating, or providing services]
True or False: Business owners have less flexibility compared to employees.
False
Business owners generally have more freedom to pursue their own goals.
What role does Training and Employment Initiatives play in community contributions?
They help improve skills and increase job opportunities within the community.
This can lead to a more skilled workforce and economic development.
What are Purchasing Policies in relation to community contributions?
Policies that favor locally produced goods and services.
This supports local businesses and stimulates the local economy.
