Financial Management Pre-Assessment

Added value (profit) can ONLY be increased by increasing prices.

• True

• False

Private sector businesses are owned and controlled by the government.

• True

• False

What is the main motive of businesses in the private sector?

• Providing products of good quality

• Servicing the society

• Profit

• Being environmentally friendly

What is the main motive of businesses in the public sector?

• Providing products of good quality

• Servicing the society

• Profit

• Being environmentally friendly

Why do governments support business start-ups?

• Giving consumers more choice and

  competing with existing businesses

• Social enterprises which offer benefits to the society, other than jobs and profits

• The economy benefits from increased output of goods and services

• All of the above

Business objectives, mission statement and product description are examples of what is included in a business plan.

• True

• False

What is a disadvantage of business growth?

• Business growth is expensive

• More profits

• Larger market share

• More status and prestige for the owners and managers

What is a form of internal growth?

• A business merges with another business in the same industry

• A business merges with/takes over another business in a different industry

• A business opening up a new branch

• A business buys out another business in the same industry

What is an advantage of horizontal integration?

• Spreading risk

• Market share will stay the same

• It is quite expensive

• The number of competitors are reduced

Which economic sector is providing more efficient products and services (better quality)?

• Private sector

• Public sector