Business exam 1

• Adding or creating value is not a very important concept of owning a business True or false?


  False
• Businesses often fail because of?

  lack of record keeping
• The concept of ............ is when customers choose to buy a laptop than a cellphone is known as the?

  Opportunity cost
• The three objectives of social entrepreneurs are known as the:

  Triple bottom line
• A business with many social objectives:

  social enterprise
• Fishing forms part of the........... sector of the economy

  Primary
• Renewable and non-renewable resources form of what factor of production"

  Land
• Adding value to a product will contribute to the........ of consumers

  standard living
• The tertiary and the service sector form one sector true or false?

  true
• Define innovation

  
  

  Entrepreneurs should be able to think creatively in the business to make a new or existing concept or product better and more attractive to the consumers. You need to be able to present your business in an attractive new way in a competitive market (you need to do things differently).
• Which business will fall under the secondary sector?

  • cc construction
• Which business will form part of the primary sector?

  fishing
• .......can help specialize in different areas of the business

  partners
• In a sole trader the owner is responsible for all aspects of business. 

  true
• This form of ownership is typically used when, construction, hairdressing, mechanics, and retailing shops or businesses are opened.

  sole traders
• Limited and ………………………. forms part of the companies forms of ownership.

  Public
• A medium to small size company, that is owned by shareholders who are most likely members of the same family, shares however cannot be sold to the general public 

  Private limited companies
• In public limited companies it can be difficult to transfer shares to other people

  true
• You can get a worker/producer cooperate they are involved in producing goods and a consumer/retail cooperative are involved in selling goods and services.

  True
• When one business starts to work together with another busines

  Joint venture
• define cooperatives

  • All participants can contribute to the business in the form of workload sharing, responsibilities, and decision making some tasks can be done by management.
• advantages of cooperatives

  • Bulk buying – better prices.
  • Joint decision-making and taking decisions in the business.
  • Motivation for members to work hard as they will benefit from shared profit
• disadvantages of cooperatives

  • Skilled Managers must be employed to prevent poor management
  • Capital shortages can occur because shares cannot be sold to non-members.
  •  Decision-making takes a long because members need to be consulted
• define franchise?

  Businesses that use the logo and name of an already successful (existing) business.
• Advantages of a franchise

  • Chances to fail is a bit less as it is a well-known name that you start in a market.
  • Training is offered by the franchise
  • Advice is offered by the franchise.
  • Advertising on a national level is covered and paid for by the franchise.
• disadvantages of a franchise?

  • A franchise fee needs to be paid to the franchise.
  • The initial franchise license fee can be expensive.
  • Local promotions may still have to be paid by the franchisee.
  • You must use the franchise accredited suppliers.
• Reasons for joint ventures

  • Risk and cost for a new business are shared.
  • Different strengths from different companies.
• Risks in joint ventures

  • Management and business culture might differ.
  • The blaming game when it comes to errors and mistakes – one can blame the other.
  • Partners in the joint venture failing can put the venture at risk.
• South African airlines form part of which sector in the economy

  Public
• If you start your own business, your business will form part of the……………

  Private
• Advantages of sole trader

  no legal formalitiesowner has complete control of the businessall profits belong to the owneryou can choose your working hours and choose who you want to work with
• disadvantages of a sole trader

  • disadvantages:Unlimited liability when it comes to debts.Competition from bigger firms in the market is intense.The owner is responsible for all aspects of the business.Raising additional capital is difficult.
• Define self motivation

  It is not always an easy task to have your own business, and entrepreneurs must work hard consistently and be keen to learn and succeed, and have focus and a lot of energy to make a success of your business venture.
• define multiskilled

  You need to be keen to learn new skills in order to be able to do a lot of different tasks in your business, from setting up a budget, to marketing, working with clients, and buying your stock in a shop.
• define leadership

  You will have to be an example to your staff, have the ability to motivate the staff in the business.
• define self-confidence

  You must have the ability to bounce back from setbacks. Do not get discouraged after a setback, most start-up businesses fail the first time.
• define risk taking

  If you want results, you must be willing to take risks, for example, take all your live savings to start a business.
• define corporate social responsbility ?

  Corporate Businesses have a duty to act socially in the best interest of their society and the environment they operate in.
• define social enterprise?

  a business with many social objectives
• define opportunity cost?


  The cost of the next most wanted product or option is given up.The cost of the next most wanted product or option is given up.