Unit 1

Question 1

What are the factors of production?

Answer 1

Land
Labour
Capital
Enterprise

Question 2

What does land mean in production?

Answer 2

Smewhere to produce the goods

Question 3

Example of land in production?

Answer 3

Farms

Question 4

What is labour in production ?

Answer 4

People to work in the business

Question 5

Example of labor is ?

Answer 5

Farmers

Question 6

What is capital in production?

Answer 6

Monney to get the business started

Question 7

An example of enterprise in production ?

Answer 7

the owner

Question 8

What is opportunity cost ?

Answer 8

When making a business deacons for the cost of not selecting the alternative opportunity cost

Question 9

what a sole trader is

Answer 9

A sole trader is a business which has only one owner. Also know as a sole proprietor. Can employ people but they will not be

Question 10

examples of sole trader businesses

Answer 10

Small shop
Plumber
Electrician
Hair dresser

Question 11

Explain Unlimited Liability

Answer 11

This means that the business and the owner are one legal entity In short if a customer sues the business, they will in fact sue the owner
If the business gets into debt,the owner gets into debt

Question 12

What types of business ownership have unlimited liability?

Answer 12

Sole traders

Partnerships

Question 13

what is a partnership business

Answer 13

Partners are all joint owners of the business The partners of the business may do decision making themselves or they may employ manager

Question 14

What is limited liability

Answer 14

The business and the owners have a separate legal identity Shareholders can only lose the value of the money that they It will protect the stockholders personal access

Question 15

what is a limited company (ltd)

Answer 15

This is were the company’s decide who buys shares

Question 16

what is a Public Limited Company (plc)

Answer 16

This means that you have limited liability Company has its own legal status

Question 17

what is a not-for-profit organisation

Answer 17

They are set up to achieve objects other than profit this most commonly to benefit others they make there funds by doing fun raisers

Question 18

what is a business stakeholder

Answer 18

A stakeholder is defined as anyone who has an interest in a business and is affected by the actions of the business

Question 19

What Influence of business location

Answer 19

Raw materials
Employment
Competitors
Infrastructure
Proximity 2 target market 
Finance

Question 20

What is a business plan?

Answer 20

A document which sets out the future plans for a business It is how an entrepreneur will explain how they will turn their idea into a successful business The entrepreneur may then show the plan to a bank to ask for a business loan

Question 21

What is organic growth

Answer 21

• Organic growth means that the business has grown from within

Question 22

What is inorganic growth

Answer 22

A business may decide to grow quicker and so it will decide to merge or takeover another business

Question 23

What is economies of scale

Answer 23

Economies of scale occur when unit costs or average costs fall as a result as an increase in the level of output of the business