IBS Mid-Term Revision

What is one major advantage of new businesses to local communities?

• Job creation

• Increased traffic congestion

• Increased pollution

• Rising living costs

One disadvantage of rapid business expansion in an area could be:

• Improved infrastructure

• Lower demand for housing

• Decreased access to healthcare

• Overcrowding and increased living costs

Which department in a new business is primarily responsible for managing cash flow, budgets, and monetary reporting?

• Marketing

• Operations

• Human Resources

• Finance

Why is not having a clear business plan a critical factor in business failure?

• It helps in reducing risk

• It leads to a lack of clear goals and strategies

• It increases investor confidence

• It ensures strategic decision-making

Why can ignoring competition lead to business failure?

• It drives sales

• It leads to underestimating market challenges

• It allows for product differentiation

• It increases customer loyalty

Disadvantages for this type of business include: owner pays for everything, hard to get money to start from the bank, owner might lack skills & unlimited liability.

• Partnership

• Franchise

• Sole Proprietorship

• Corporation

Disadvantages of this type of business include: company is taxed on profits, regulated by the government, and hard to start

• Sole Proprietorship

• Franchise

• Partnership

• Corporation

Which of the following best explains limited liability?

• Owners are personally responsible for all business debts

• Owners' personal assets are protected from business debts

• Business debts are shared equally among all employees

• There is no legal distinction between the business and its owners

How many people could own a partnership?

• 2 - 10 people

• 0 - 10 people

• 2 - 20 people

• 0 - 20 people

What is a limited company?

• A limited company, is incorporated, which means it can sue or own assets in its own right. Personal assets are separate from company assets and therefore protected from company debts.

• A limited company, is incorporated, which means it can sue or own assets in its own right. Personal assets are NOT separate from company assets and therefore NOT protected from company debts.