Font size
WorksheetsUnderstanding Business
Total questions: 69
Worksheet time: 2hrs 21mins
A good is...
something intangible
something tangible
a need
a want
A service is...
something intangible
something tangible
a need
a want
Which of the following can be classed as a need
designer handbag
TV
games console
shelter
An example of a want is
water
food
phone
clothes
An entrepreneur is someone who
works for a business
starts their own business
Which is a skill/quality of an entrepreneur?
indecisive
timid
takes risks
idle
Which is NOT a skill/quality of an entrepreneur?
creative
determined
hardworking
cautious
Which is not a factor of production?
earth
labour
capital
enterprise
Which is a factor of production
money
land
machinery
equipment
Why would someone want to start their own business
it might be fun
they want to be their own boss
they have no money
they do not have an idea
What would be a risk of starting your own business
people may not buy your product
you will make lots of money
someone else will pay your debt
How can you reduce the risks of starting your own business?
prepare a business plan
get a loan
sell your house
What information should be in a business plan?
business name
images
What are the three Sectors of Industry
Public, Private & Third
Primary, Secondary & Tertiary
The primary sector can be described as...
Extraction of natural resources such as coal and oil from the land.
Manufacturing – turning raw materials into finished goods.
Also known as the service sector.
Provision of services or selling goods.
The secondary sector can be described as...
Extraction of natural resources such as coal and oil from the land.
Manufacturing – turning raw materials into finished goods.
Also known as the service sector.
Provision of services or selling goods.
The third sector can be described as...
Extraction of natural resources such as coal and oil from the land.
Manufacturing – turning raw materials into finished goods.
Also known as the service sector.
Provision of services or selling goods.
Which would be an example of the primary sector?
NHS
House building
Food manufacturing
Fishing
Which would be an example of the secondary sector?
Farming
Hairdressing
Car manufacturing
Forestry
Which would be an example of the tertiary sector?
House building
Transport
Mining
Food manufacturing
When is wealth created?
When selling the goods/services
When making a profit
At each stage of the production process
Is Police Scotland...
Primary
Secondary
Tertiary
Is Coal Mining...
Primary
Secondary
Tertiary
Is Vauxhall Car Manufacturers...
Primary
Secondary
Tertiary
What are the three Sectors of Economy
Public, Private & Third
Primary, Secondary & Tertiary
The private sector is made up of businesses owned by...
The Government
Private individuals
The public sector is made up of businesses owned by...
The Government
Private individuals
Which is the most common type of business organisation in the UK
Sole Trader
Partnership
LTD
PLC
A Sole Trader is a business owned and run by
2-20 people
one person
shareholders
Which would be a common example of a sole trader?
Tesco
Cafe
Starbucks
What is an advantage of being a sole trader?
Long working hours may be required to establish the business.
Can be difficult to organise time off or holidays.
Business affairs can be kept private.
What is an advantage of being a sole trader?
Being the sole decision maker can be a burden and the quality of decisions may be poor if the sole trader lacks expertise.
Often small businesses so they don’t require as much equity (investment).
Borrowing money can be difficult (eg getting a bank loan) since the business is small.
What is a disadvantage of being a sole trader?
The owner gets to keep all profits.
A more personal service is usually offered to customers – a way of fighting off the competition!
Borrowing money can be difficult (eg getting a bank loan) since the business is small.
What is a disadvantage of being a sole trader?
The owner is in full control of their business – they get to make all decisions.
Very easy to set up – few legal requirements.
Can be difficult to organise time off or holidays.
A Partnership is a business owned and run by
2-20 people
one person
shareholders
A common example of a partnership would be...
Asda
Solicitors
British Heart Foundation
What do partners complete to ensure a fair distribution of workload and profits?
Contract
Partnership Agreement
They do not complete anything
How is a partnership similar to a sole trader?
business affairs can be kept private
there are few legal requirements when setting up
All of the above
None of the above
Which would be an advantage of a partnership?
Profits must be shared.
Partners have unlimited liability.
More owners than a sole trader which means more equity invested in the business.
Which would be an advantage of a partnership?
Profits must be shared.
Decision making and responsibilities are shared.
Disagreements can occur when making decisions.
Which would be a disadvantage of a partnership?
Partners have unlimited liability.
Decision making and responsibilities are shared.
Specialisation – jobs can be completed to a high standard if partners specialise in their area of expertise.
Which would be a disadvantage of a partnership?
More owners than a sole trader which means more equity invested in the business.
Profits must be shared.
Specialisation – jobs can be completed to a high standard if partners specialise in their area of expertise.
An LTD is a...
Private Limited Company
Public Limited Company
An PLC is a...
Private Limited Company
Public Limited Company
A Limited Company is a business owned and run by
2-20 people
one person
shareholders
Which would be a feature of a LTD
Owned by private shareholders who usually need to be invited to become a shareholder. Existing shareholders must agree to the admission of any new shareholders.
Must have at least one shareholder and one director. No maximum number of shareholders
Run by a board of directors which could be all shareholders if it is a small company
Shareholders receive a share of the profits each year called a dividend. This will be dependent on the amount of profit made by the company and their future plans eg it may be decided to keep much of the profit to invest in future projects.
All of the above
Which would be an advantage of a LTD
Limited ability to raise finance through share issue since shares cannot be sold on the stock market.
Ability to become larger than a partnership since there is no limit on the number of shareholders.
Financial accounts need to be made public.
Which would be an advantage of a LTD
Limited ability to raise finance through share issue since shares cannot be sold on the stock market.
Ownership is not lost to outsiders since existing shareholders agree who to admit as new shareholders.
Financial accounts need to be made public.
What would be a disadvantage of a LTD
Ability to become larger than a partnership since there is no limit on the number of shareholders.
Ownership is not lost to outsiders since existing shareholders agree who to admit as new shareholders.
Financial accounts need to be made public.
What would be a disadvantage of a LTD
Ability to become larger than a partnership since there is no limit on the number of shareholders.
Ownership is not lost to outsiders since existing shareholders agree who to admit as new shareholders.
Limited ability to raise finance through share issue since shares cannot be sold on the stock market.
A sole trader and partnership have
Limited Liability
Unlimited Liability
A LTD and PLC have
Limited Liability
Unlimited Liability
The public sector is made up of businesses owned by...
The Government
Private individuals
The public sector can be split into 3 sections, what are they?
Central Government
Local Government
Public Corporations
All of the above
The central government has overall responsibility for the provision of essential services for the whole country, such as
Schools
NHS
Libraries
BBC
The local government has overall responsibility for the provision of essential services for the whole country, such as
Schools
NHS
Social Security
BBC
The third sector is made up of
Social Enterprises
Government run organisations
Private individuals
A social enterprise is
a business out to make a profit
a business that trades for a social and/or environmental purpose
An example of a social enterprise would be
Costa
McDonalds
The Big Issue
Which other business operates in the third sector
Sole Trader
Non-profit making organisations
LTD
Partnership
When should effective customer service be provided when purchasing a good/service?
Before purchase
During purchase
After purchase
All of the above
What does a customer want when buying a product/service?
Poor quality
Affordable prices
Slow service/delivery
No credit options
What does a customer want when buying a product/service?
Poor quality
The right advice/information
Slow service/delivery
No credit options
How do we ensure staff deal with customers in a way which benefits the business?
Train the staff
Tell the staff what to do
Let them decide how best to deal with the situation
Over-promise & under-deliver
Which would be a benefit of providing good customer care/service
Reduction in customers
Increased customer loyalty.
Increase in complaints
Reduction in sales
Which would be a benefit of providing good customer care/service
Reduction in customers
Reduction customer loyalty.
Increase in complaints
Increase in sales/profits
Describe the difference between limited liability and unlimited liability
How confident are you for your test
Very confident
Confident
Neither confident or unsure
Unsure
Very unsure
Why do businesses exist?
To provide a good or service to customers
To make a profit
To develop an idea
To fill a gap in the market
All of the above
