Business Quiz

Business activity

100

1. Explain the difference between needs and wants and give one example of each in a business context

Needs are basic necessities required to survive, such as food, water, and shelter. Wants are goods or services people would like to have but are not essential, such as designer clothes or video games. Businesses often produce wants to satisfy consumer demand.

200

2. Why do businesses specialize? Give one advantage and one disadvantage of specialization.

Businesses specialize to focus on producing a limited range of goods or services.

• Advantage: Workers become more skilled and efficient, increasing productivity.
• Disadvantage: Workers may become bored doing repetitive tasks, which can lower motivation.

300

3. Describe what is meant by the factors of production and explain how two of them are used in a restaurant business.

The factors of production are resources used to produce goods and services:

• Land: Natural resources (ingredients used in food).
• Labour: Workers preparing and serving food.
• Capital: Equipment such as ovens or tables.
• Enterprise: The entrepreneur organizing the business.

400

4. Explain the concept of opportunity cost using an example of a business decision.

Opportunity cost is the next best alternative that is given up when making a decision.

Example: If a business spends money on advertising instead of buying new equipment, the lost equipment is the opportunity cost.

500

5. Why is adding value important for a business? Suggest one way a company can add value to its product.

Adding value increases the difference between the cost of producing a product and the price customers pay. This helps businesses make higher profit and attract customers.

Example: Packaging fruit into ready-to-eat snack boxes.

People in business

100

1. Explain two responsibilities of a Human Resources department.

• Recruiting and selecting new employees.
• Organizing training and development programs.

200

2. Describe the difference between recruitment and selection.

Recruitment involves attracting suitable candidates to apply for a job.

Selection involves choosing the best candidate from those who applied.

300

3. Explain two benefits to a business of providing training for employees.

• Improves employee skills and productivity.
• Reduces mistakes and improves quality of work.

400

4. Compare financial and non-financial methods of motivation, giving one example of each.

• Financial motivation: Money-related rewards such as bonuses or salary increases.
• Non-financial motivation: Rewards not related to money such as praise, promotion, or flexible working hours.

500

5. Explain why communication is important inside a business and describe one method of internal communication.

Communication helps employees understand their roles and reduces mistakes.

Example: Emails are commonly used to share information quickly within a business.

Marketing

100

1. What is meant by market segmentation and why do businesses use it?

Market segmentation means dividing customers into groups based on characteristics such as age, income, or interests. Businesses use it to target products more effectively.

200

2. Explain the difference between primary research and secondary research, giving one example of each.

• Primary research: Collecting new data directly from customers (surveys or interviews).
• Secondary research: Using existing data (government reports or online articles).

300

3. Describe the four elements of the marketing mix.

• Product: The good or service offered.
• Price: The amount customers pay.
• Place: Where the product is sold.
• Promotion: Advertising and methods used to inform customers.

400

4. Explain two factors a business should consider when setting the price of a product

• Cost of production: Price must cover costs.
• Competition: Businesses must consider competitors’ prices.

500

5. Why is branding important for businesses?

Branding helps customers recognize products, builds loyalty, and makes products stand out from competitors.

Operations management

100

1. Explain the difference between job production, batch production, and flow production.

• Job production: Producing one customized product at a time (wedding cake).
• Batch production: Producing items in groups (baking bread in batches).
• Flow production: Continuous production of identical products (car manufacturing).

200

2. Describe two ways technology has improved production processes.

• Speeds up production using machines.
• Improves accuracy and reduces human errors.

300

3. Explain why quality control is important for a business.

Quality control ensures products meet standards, reduces customer complaints, and protects business reputation.

400

4. What is meant by lean production and how can it help reduce waste?

Lean production focuses on reducing waste and improving efficiency. It helps lower costs and increase productivity.

500

5. Describe two factors a business should consider when choosing a location.

• Cost of land and rent.
• Access to customers or transport links.

Finance

100

1. Explain the difference between revenue, cost, and profit.

1. Revenue, cost, and profit

• Revenue: Money earned from sales.
• Cost: Money spent running the business.
• Profit: Revenue minus costs.

200

2. Describe the difference between fixed costs and variable costs, giving one example of each.

• Fixed costs: Do not change with output (rent).
• Variable costs: Change depending on production level (raw materials).

300

3. Explain why businesses prepare a cash flow forecast.

It predicts money coming into and leaving a business. It helps businesses avoid running out of cash and plan spending.

400

4. Describe two sources of finance available to a small business.

• Bank loans.
• Personal savings of the owner.

500

5. Explain what is meant by break-even point and why it is important for businesses.

The break-even point is when total revenue equals total costs. It is important because it shows when a business starts making profit.