Topic 1 Enterprise and Entrepreneurship

Who buys the product?

Customer

What is an original idea?

A new idea that has not been created before

Who uses the product?

Consumer

What is the definition of a business

An organisation that offers for exchange, the services and goods that satisfy consumers needs and wants

What is a good?

A physical product

What is a service

A non physical product

What is an entrepreneur?

Someone who creates a business and takes on financial risks with the aim of making a profit

What is a gap in the market?

When there is not currently a product being sold but a customer wants and will buy it

What is a competitive advantage?

When someone does the idea first therefore gets all the customers

What are the three reasons new ideas for businesses come about?

Changes in technology, consumer wants change and becoming obsolete

What does it mean if a product becomes obsolete?

No longer bought

What are the two ways businesses come about?

Original ideas or adapting existing products

What are the three main risks of a business

Business failure, Financial loss ans lack of security

How do you reduce risk of business failure ?

Market Research, Financial forecast ans raise enough Start up Capital

What is market research?

Finding out what customer wants and needs then providing it at the right price and location

What is financial forecast?

Predicting If a business will succeed

What is a business reward?

The benefit the business brings to the owner

How do you calculate profit ?

Total Revenue (all Money coming in) - Total cost