study guide

Question 1

an investment worth money; a “financial instrument” indicating ownership. Ex. Stock in companies like apple or McDonald’s that are traded in the stock market is security.

Answer 1

1. Securities

Question 2

an investment vehicle. Different types of securities include stocks, bonds, and mutual funds.

Answer 2

2. Security

Question 3

the ability to pursue what you think is right or necessary to do despite temptations to quit.

Answer 3

3. Self-Discipline

Question 4

the ability to pursue a task without being told by someone else. Individuals who are self-motivated can find the strength to start and then finish a task without giving up.

Answer 4

4. Self-motivation

Question 5

costs that vary somewhat based on the number of units you sell. Ex. If your enterprise buys you an iPhone you won’t have to pay again for apps you already own.

Answer 5

5. Semi-variable Costs

Question 6

an individual that owns a company. Sole proprietors are taxed on the profits of the company, and are personally liable for any debts or judgements against the company.

Answer 6

6. Sole proprietorship

Question 7

one of the equal parts into which the company’s capital into which a company’s capital is divided. Entitling the holder to a proportion of the profits. Share reefers to the ownership certificates of a particular company.

Answer 7

7. Share

Question 8

an individual or company that owns a share in a company

Answer 8

8. Shareholder

Question 9

all people or companies associated with an enterprise. Stakeholders include internal stakeholders (employees and shareholders/owners) as well as external stakeholders (customers, suppliers, community members).

Answer 9

9. Stakeholders

Question 10

shares of ownership in a company. Stock is a general term of ownership in any company. Ex. If investors say they own stocks they are generally referring to their overall ownership in one or more companies.

Answer 10

10. Stocks

Question 11

a company that provides a good or service to another company.

Answer 11

11. Supplier

Question 12

the hard work a small business owner puts into forming, founding, and operating his/her business. Small business owners typically work long business hours. Sweat equity is as important as any capital but it’s not a cash investment.

Answer 12

12. Sweat equity

Question 13

the exact customers and market sector the business intends to serve.

Answer 13

13. Target market

Question 14

working with others to address a challenge. Individuals using their skills in harmony with others to complete a task. Effective teamwork involves trust among team members. Collaboration and cooperation.

Answer 14

14. Teamwork

Question 15

• fixed cost plus variable cost.

Answer 15

15. Total cost

Question 16

unit times price.

Answer 16

16. Total revenue

Question 17

the practice of operating openly and communicating fully. Providing stakeholders with a clear understanding of how your enterprise operates.

Answer 17

17. Transparency

Question 18

• assets that are not already pledged to the bank as a guarantee to repay another loan.

Answer 18

18. Unencumbered-

Question 19

• units refer to the things the company sells. Retail stores sell many different types of units. Service businesses can sell many different services.

Answer 19

19. Units

Question 20

debt that does not include a promise by a guarantor to repay the loan in the event that the debt-holder is unable to make a required payment.

Answer 20

20. Unsecured Debt

Question 21

• costs that vary based on the units sold by your enterprise

Answer 21

21. Variable cost