Chapter 3: Enterprise, business growth and size

Front

The advantage of a person becoming an entrepreneur is:

Back

there is more independence than when working for an employer

Front

An important characteristic of a successful entrepreneur is that:

Back

they are risk takers

Front

A business plan for a new business will include all of the following except: financial forecasts, market research data, details of the business owners, previous years' accounts

Back

previous years' accounts

Front

What benefit does drawing up a business plan bring for a new entrepreneur?

Back

it helps in organising the resources needed for the new firm

Front

Which of the following is not an effective way of measuring the size of a business? number of employees, value of sales, value of capital invested, profit level

Back

profit level

Front

Which of the following options is most likely to be a reason why a firm may wish to expand? Options: To keep control of the business, To increase the level of profits the firm will make, To encourage competition, To avoid publicity

Back

To increase the level of profits the firm will make

Front

Which of the following is an example of horizontal integration between two businesses? Options: An oil company and an insurance company merge, A shoe shop buys out a shoe factory, A steel firm takes over a coal mine that supplies coal, Coca-Cola takes over a small soft drink business

Back

Coca-Cola takes over a small soft drink business

Front

One of the reasons for vertical integration between two businesses could be to: diversify into a completely different industry, reduce competitors supplying the same product, control the supply of raw material, obtain higher market share

Back

control the supply of raw material

Front

One of the most common reasons for a new business not surviving is:

Back

poor cash flow as a result of poor financial planning

Front

If the risks of starting up a business are so high, why do entrepreneurs create new businesses?

Back

The rewards can be very high