Big Business Quiz 1

Added value is achieved by:

• Buying raw materials at a high price.

• Transforming resources into finished goods.

• Selling products through expensive channels.

• Keeping production costs as low as possible.

The secondary sector focuses on:

• Growing crops and raising livestock.

• Providing services like healthcare and education.

• Manufacturing finished goods from raw materials.

• Importing and exporting goods.

What is the main advantage of a franchise business?

• Lower start-up costs

• Higher profits guaranteed

• Complete control over operations

• No risk of failure

Specialization happens when:

• A business makes multiple products.

• Individuals focus on specific tasks.

• A country imports different goods.

• All workers have the same skills.

The economic problem refers to the issue of:

• Managing limited resources to satisfy unlimited wants.

• Calculating profits and losses for businesses.

• Setting salaries for employees.

• Choosing the best location for a business.

The opportunity cost of going to the cinema is:

• The price of the cinema ticket.

• The cost of popcorn and drinks.

• The next best alternative given up by choosing another item.

• The time spent traveling to the cinema.

Internal growth involves:

• Expanding existing products or services.

• Acquiring other businesses.

• Partnering with another company.

• Focusing on different markets.

In a public limited company, who owns the business?

• The manager

• The sole trader

• The shareholders

• The government

What does it mean for a business to be profitable?

• Revenue exceeds expenses

• Expenses exceed revenue

• No change in overall income

• All employees receive bonuses

What type of payment is typically fixed and based on a set time period?

• Wage

• Salary

• Bonus

• Commission