Topic 24

Question 1

Non-Monetary Opportunity Costs

Answer 1

1. Emotional/psychological
2. Long-term lifestyle impact
3. Missed satisfaction

Question 2

What do business choices involve

Answer 2

-> what to invest in
-> who to hire or lay off
-> how to respond to market changes

Question 3

What should entrepreneurs consider with business choices

Answer 3

-> Risk vs reward
-> Short-term vs long-term gain
-> Profit vs ethics
-> Control vs outsourcing

Question 4

Common trade off situations -> 4

Answer 4

1. Investing in staff training
2. Increasing dividend payouts
3. Going ethical
4. Holding cash reserves

Question 5

Benefits of running a business:

Answer 5

1. Independence
2. Financial gain
3. Job satisfaction
4. Flexibility

Question 6

Trade offs of running a business

Answer 6

-> Leaving secure jobs
-> Financial risks
-> Less personal time
-> Emotional stress

Question 7

Tools businesses use to make decisions: 5

Answer 7

• List pros and cons of each option
• Cost-benefit analysis
• Balance short-term and long-term impacts
• Gauge stakeholder opinions (e.g. investors, employees)
• Use financial forecasts and risk analysis