Topic 5 - Entrepreneurs And Leaders

Question 1

Entrepreneur

Answer 1

Individuals who typically, set up and run a business and take risks associated with it

Question 2

Intrapreneur

Answer 2

Employees who use entrepreneurial skills, without having to risk their own money, to find and develop initiatives that will have financial benefits for their employer

Question 3

Profit maximising

Answer 3

To make as much profit as possible in a certain time period

Question 4

Profit satisficing

Answer 4

To make enough profit to satisfy the needs of the business owner

Question 4

Articles of association

Answer 4

A document that provides details of the internal running of a limited company

Question 5

Certificate of incorporation

Answer 5

A document that declares a business is allowed to trade as a limited company

Question 6

Co-operative

Answer 6

A business organisation owned by its members, who have equal voting rights

Question 7

Deed of partnership

Answer 7

A binding legal document that states the formal rights of partners

Question 8

Franchise

Answer 8

A business model in which a business (the franchisor) allows another operator (the franchisee) to trade under their name

Question 9

Lifestyle business

Answer 9

A business that aims to make enough money and provide the flexibility to support a particular lifestyle for the owner

Question 10

Limited company

Answer 10

A business organisation that had a separate legal entity from that of its owners

Question 11

Aims

Answer 11

What a business tries to achieve in the long term

Question 12

Objectives

Answer 12

The goals or targets set by a business to help achieve its long term purpose

Question 13

Sales maximisation

Answer 13

An attempt to sell as much as possible in a given time period

Question 14

Limited liability

Answer 14

A legal status which means that a business owner is only liable for the original amount of money invested in the business

Question 15

Limited partnership

Answer 15

A partnership where some members contribute capital and enjoy a share of profit, but do not participle in the running of the business. At least 1 partner must have unlimited liability

Question 16

Memorandum of Association

Answer 16

A document that sets out the constitution and states external details about a limited company

Question 17

Online business

Answer 17

A business that uses the online global communications infrastructure of the Internet, as a trading base

Question 18

Mutual organisation

Answer 18

A business owned by its members, who are customers not shareholders

Question 19

Partnership

Answer 19

A business organisation usually owned by 2-20 people

Question 20

Primary sector

Answer 20

Production involving the extraction of raw material from the earth

Question 21

Secondary sector

Answer 21

Production involving the conversion of raw materials into finished and semi-finished goods

Question 22

Sleeping partner

Answer 22

A partner that contributes capital & enjoys a share of the profits but takes no active role in running the business

Question 23

Social enterprise

Answer 23

A business that trades with the objective of improving human or environmental wellbeing e.g. Charities & worker co-operatives

Question 24

Sole trader/proprietor

Answer 24

A business organisation with a single owner

Question 25

Tertiary sector

Answer 25

The production of services in the economy

Question 26

Unlimited liability

Answer 26

A legal status which means that the business owner is personally liable for all business debts

Question 27

Private equity company

Answer 27

A business usually owned by private individuals, backed by financial institutions

Question 28

Public limited company

Answer 28

A company owned by shareholders where the shares can be traded openly on the stock market

Question 29

Stock-market

Answer 29

A market for second hand shares

Question 30

Stock market flotation/ initial public offering

Answer 30

The process of a company making shares available to the public for the first time

Question 31

Choices

Answer 31

In business, deciding between alternative uses of resources

Question 32

Opportunity cost

Answer 32

When choosing between different alternatives, the opportunity cost is the benefit lost, from the next best alternative, to the one that has been chosen

Question 33

Trade-offs

Answer 33

In business, where a decision - maker faces a compromise between two different alternatives

Example: paying dividends to shareholders and re-investing profits in the business