BUSINESS STUDIES

What is the primary purpose of a business?

To produce goods or provide services to meet customer needs and generate profit.

What are goods in the context of business?

Tangible products that businesses produce and sell, such as clothes, electronics, or food.

What are services in the context of business?

Intangible offerings that businesses provide, like hairdressing, banking, or education.

What is an entrepreneur?

A person who sets up a business, taking on financial risks in the hope of profit.

Define "profit."

Profit is the financial gain a business makes when its revenue exceeds its expenses.

What are the three main sectors of industry?

Primary, Secondary, and Tertiary sectors.

What is the Primary Sector?

The sector that involves the extraction of natural resources, such as farming, mining, and fishing.

What is the Secondary Sector?

The sector that involves manufacturing and processing raw materials into finished goods.

What is the Tertiary Sector?

The sector that provides services rather than goods, such as retail, healthcare, and education.

What is a "business objective"?

A specific, measurable target a business aims to achieve, such as increasing profits or expanding market share.

Name three common business objectives.

Profit maximization, customer satisfaction, and growth.

What is a "stakeholder"?

Any person or group affected by a business's actions, including employees, customers, shareholders, and the community.

Define "adding value."

Increasing the worth of a product or service by improving it or creating something unique, allowing it to be sold for more.

What is the difference between a "need" and a "want"?

A need is essential for survival (like food, shelter), while a want is something desirable but not necessary (like luxury items).

What is the "private sector"?

The part of the economy owned and controlled by private individuals and companies, aiming to make a profit.

What is the "public sector"?

The part of the economy owned and operated by the government, often providing services like education and healthcare.

What are "non-profit organizations"?

Organizations that aim to provide a service or benefit society, rather than make a profit, like charities.

What is a "social enterprise"?

A business with social or environmental goals, reinvesting profits back into its mission instead of maximizing shareholder returns.

Define "market research."

The process of gathering, analysing, and interpreting information about a market, including customer needs and preferences.

What is "primary research"?

Collecting new, original data directly from sources, such as surveys, interviews, and observations.

What is "secondary research"?

Analysing existing information collected by others, like reports, studies, and market analysis.

Why do businesses conduct market research?

To understand customer needs, reduce risks, identify opportunities, and make informed decisions.

What is a "target market"?

A specific group of consumers a business aims to reach with its products or services.

What is "innovation"?

Creating new products or improving existing ones to meet customer needs and stay competitive.

What is a "business plan"?

A document outlining a business’s objectives, strategies, market research, and financial forecasts.

Why is a business plan important?

It helps secure funding, provides direction, and sets measurable goals for the business.

What is "risk" in business?

The possibility of loss or failure in a business activity.

What is "reward" in business?

The potential positive outcome, such as profit or business growth, that an entrepreneur seeks.

What are "fixed costs"?

Costs that remain the same regardless of production levels, like rent, salaries, and insurance.

What are "variable costs"?

Costs that change based on the level of production, like materials and direct labour.

What is "revenue"?

The total income a business earns from sales before any costs are deducted.

What is a "sole trader"?

A business owned and operated by one person, who has full control but unlimited liability.

What is a "partnership"?

A business owned by two or more people who share responsibility, profit, and liability.

What is a "private limited company" (Ltd)?

A company owned by shareholders, often family or friends, with limited liability.

What is "limited liability"?

A legal status where the owners' personal assets are protected if the business fails.

What is "unlimited liability"?

A situation where business owners are personally responsible for all business debts if it fails.

Define "shareholder."

A person or entity that owns shares in a company and has a claim to a part of its profits.

What is "customer satisfaction"?

A measure of how products or services meet or exceed customer expectations.

What are "ethics" in business?

Moral principles that guide business decisions, emphasizing fairness, honesty, and responsibility.

Define "sustainability" in business.

Operating in a way that considers long-term environmental, social, and economic impact.

What is "competitive advantage"?

An attribute that allows a business to outperform its competitors, like lower prices or better quality.

What is "market share"?

The percentage of total sales in a market held by one business.

What is a "business objective" for a start-up?

Commonly, survival and establishing a customer base are key early objectives for start-ups.

Why might a business want to expand?

To increase sales, reach new markets, and achieve economies of scale.

What is "diversification"?

Expanding into new products or markets to spread risk and increase potential revenue.