Setting Up A Business (unit 1)

Question 1

What is an entrepreneur

Answer 1

A person who is willing to take the risks involved in starting a business

Question 2

What s a social enterprise

Answer 2

A business that is set up to help society rather than to make a profit

Question 3

What is market research?

Answer 3

This is the process of gathering, analysing and presenting data relevant to marketing

Question 4

What is primary market research?

Answer 4

This involves gathering and analysing marketing data that has not been collected before

Question 5

What is secondary market research?

Answer 5

This involves gathering and analysing marketing data that has been collected already.

Question 6

What is market share?

Answer 6

Market share is indicated by the sales of one product compared to the total market sales

Question 7

What is a franchise?

Answer 7

A franchise occurs when a franchisor sells an existing business idea to a franchisee

Question 8

What is a franchisor?

Answer 8

A franchisor is the seller of a franchise

Question 9

What is a franchisee?

Answer 9

A franchisee is the buyer of a franchise

Question 10

What is an objective/ aim for a business?

Answer 10

An objective(or aim) is a target that is set for a business to achieve

Question 11

What are stakeholders?

Answer 11

Stakeholders are individuals and organisations that are affected by and affect the activities of a business

Question 12

What is business planning?

Answer 12

Business planning is the process of producing a business plan

Question 13

What is a risk?

Answer 13

A risk is the possibility of something going wrong

Question 14

What is an uncertainty?

Answer 14

An uncertainty is something that we cannot be sure will happen.

Question 15

What is a sole trader?

Answer 15

A sole trader is an individual who sets up their business on their own

Question 16

What is unlimited liability?

Answer 16

Unlimited liability occurs when the personal possessions of the business are at risk. There is no limit to the amount of money the owners have to pay out.

Question 17

What is limited liability?

Answer 17

Type of investment in which a partner or investor cannot lose more than the amount invested.

Question 18

What is a partnership?

Answer 18

A partnership is formed when two or more people set up in business together

Question 19

What is a company?

Answer 19

A company is a business that has its own legal identity and can own items , owe money, sue and be sued.

Question 20

What is a shareholder?

Answer 20

A shareholder is an owner of a company. Each shareholder owns a ‘share’ of the business.

Question 21

What is a market segment?

Answer 21

A market segment is a group of similar needs within the overall market

Question 22

What is revenue?

Answer 22

Revenue is the income that a firm receives from selling its goods or services.

Question 23

What are costs?

Answer 23

Costs are the spending that is necessary to set up and run a business

Question 24

What is the formula for revenue?

Answer 24

Selling price x sales

Question 25

What is the formula for total costs?

Answer 25

Total fixed costs+total variable costs

Question 26

What is meant by a gap in the market?

Answer 26

A Gap in the market means that in the market it represents the opportunities for companies to expand their customer base by increasing awareness

Question 27

What is the definition of profit?

Answer 27

The money that is left over from the revenue after paying all the costs

Question 28

What is job production?

Answer 28

Job production where items are made individually and each item is finished before the next one is started. An example of this is designer dresses

Question 29

What is batch production?

Answer 29

Batch production where groups of items are made together. Each batch is finished before starting the next block of goods. An example of this is producing bread.

Question 30

What is flow production?

Answer 30

Flow production where identical, standardised items are produced on an assembly line. An example of this is making cars