Pretest-Understanding Entrepeneur

What is the main purpose of a business?

• To pay taxes

• To make a profit

• To employ people

• To follow government regulations

Which of the following best describes the term 'opportunity cost'?

• Profit earned from investment

• Cost to produce one more unit

• The best alternative that is forgone

• Money spent on advertising

Which of the following is not a factor of production?

• Land

• Capital

• Price

• Labor

A business that provides internet services operates in which sector?

• Primary

• Secondary

• Tertiary

• Quaternary

A sole trader is a business:

• Owned by shareholders

• Owned by the government

• Owned and controlled by one person

• Owned by a board of directors

Which of the following is an example of a primary sector activity?

• Car manufacturing

• Oil extraction

• Banking

• Retail

What is meant by 'added value'?

• The difference between sales and total costs

• Sales price minus raw material costs

• Labor costs

• Raw material costs

Which of the following is an example of a public sector organization?

• Tesco

• British Armed Forces

• Amazon

• McDonald's

Which of the following is a reason why businesses fail?

• High profits

• Lack of competition

• Poor cash flow

• Strong leadership

The main purpose of a non-profit organization is:

• Maximize revenue

• Satisfy shareholders

• Provide services

• Reduce costs