unit 1 Flashcards
What is a business?
A business is an organisation that exists to provide goods and services
Why do businesses exist?
Businesses exist because they are formed by entrepreneurs who have made a calculation of the risks v the rewards.
Who are entrepreneurs?
An individual who sets up and runs a new business stemming from their own enterprise, they take on the risks associated with the business.
What role do entrepreneurs play?
Entrepreneurs (and the enterprise that they demonstrate) play a key role in the formation and development of businesses. In particular, entrepreneurs:
Spot business opportunities
Take (calculated) risks in order to gain possible future returns
Act a catalyst for the creation & growth of new business enterprises
What is entreprise?
Enterprise is something most people have but not all choose to run their own business. It’s an ability to come up with ideas and new ways of doing things.
How do businesses begin?
Entrepreneurs manage the four factors of production: LAND, LABOUR, CAPITAL, ENTERPRISE. Each of these factors is offered by individuals and each factors earns a return for its employment in an enterprising activity.
What motivates entrepreneurs?
Most businesses exist in order to earn a return for the business owners, and the potential for profit is a key motive for entrepreneurial activity. However, there are other potential business objectives such as:
Growth Ethical reasons
Survival To benefit society
Research
What do business do?
Transform inputs or resources into goods and services
INPUTS PROCESSES OUTPUTS
What are the types of businesses?
Primary
Secondary
Tertiary
What actually is a business objective?
Business objectives are the stated, measurable targets of how to achieve business aims.
What is a mission statement?
A formal summary of the aims and values of a company, organization, or individual.
