AS Business Diagnostic Test

What is the primary purpose of business activity?

• To create employment

• To satisfy human wants and needs

• To generate tax revenue

• To compete with other businesses

Which factor of production represents human effort in business?

• Land

• Labour

• Capital

• Enterprise

What is the main characteristic of a planned economy?

• Private ownership of resources

• Market forces determine prices

• Government controls resource allocation

• Competition drives efficiency

Which business objective focuses on increasing market share?

• Profit maximization

• Growth

• Survival

• Social responsibility

A sole trader business structure offers which main advantage?

• Limited liability

• Easy access to capital

• Complete control and decision-making

• Shared workload

What does unlimited liability mean for business owners?

• They can expand without restrictions

• They have no legal responsibilities

• They are personally responsible for all business debts

• They can hire unlimited employees

Which type of business organization is owned by its members?

• Private limited company

• Public limited company

• Cooperative

• Partnership

What is the main purpose of a business plan?

• To impress investors only

• To provide direction and secure funding

• To comply with legal requirements

• To increase sales immediately

Which stakeholder group has the most direct financial interest in a company's profitability?

• Customers

• Employees

• Shareholders

• Government

What does corporate social responsibility (CSR) primarily involve?

• Maximizing profits at any cost

• Following only legal requirements

• Considering impact on society and environment

• Focusing solely on customer satisfaction