1.

Enterprises

Q1: Define enterprise and entrepreneurship, and explain their importance in an economy.
A1: An enterprise is a business that takes risks to produce goods or services. Entrepreneurship
involves innovation, risk-taking, and resource organization. It drives economic growth, creates
jobs, and fosters innovation.

Q2: What are the risks and rewards of starting a business?

A2:

● Risks: Financial loss, time commitment, and market uncertainty.

● Rewards: Profit, independence, and personal satisfaction.

Q3: Explain the difference between innovation and risk-taking in entrepreneurship.

A3:

● Innovation: Creating new ideas, products, or processes.

● Risk-taking: Investing resources despite uncertainty.

Q4: Why is resource organization critical in enterprise operations?

A4: Efficient organization of land, labor, and capital ensures smooth production, cost efficiency,
and profitability.

Q5: How do enterprises contribute to economic growth and job creation?

A5: Enterprises create demand for goods, generate employment, and improve living standards,
boosting GDP.

2. Business Structures

Q1: Compare and contrast sole proprietorship, partnership, and limited companies.
A1:

● Sole Proprietorship: Easy setup, full control, unlimited liability.

● Partnership: Shared risks/profits, conflict potential.
● Limited Companies: Limited liability, access to capital, complex regulations.

Q2: What are the advantages and disadvantages of being a shareholder in a public limited
company?
A2:

● Advantages: Limited liability, dividend income.

● Disadvantages: Lack of direct control, profit dependency.
Q3: How do cooperatives and franchises differ from traditional business structures?
A3:

● Cooperatives: Owned by members for mutual benefit.

● Franchises: Licensed brand operation by franchisees.

Q4: Why do some businesses choose to remain private rather than go public?
A4: To maintain control, avoid public scrutiny, and reduce regulatory burdens.

Q5: Discuss the role of legal structures in protecting business owners and investors.
A5: Legal structures determine liability, profit distribution, and taxation, protecting assets and
interests.

3. Size of Business

Q1: How is the size of a business measured, and why is it important?

A1: By revenue, employees, capital, and market share. It helps stakeholders assess growth and
stability.

Q2: What are the benefits and challenges of being a small business in a competitive market?
A2:

● Benefits: Flexibility, personal customer service.

● Challenges: Limited resources, competition.

Q3: Explain economies of scale and diseconomies of scale with examples.

A3:

● Economies: Bulk buying reduces unit costs.

● Diseconomies: Coordination issues increase costs.

Q4: Why might a business deliberately remain small despite opportunities for growth?
A4: To retain control, ensure quality, and maintain personal customer relationships.

Q5: How do governments support micro and small businesses?

A5: Through grants, tax incentives, and training programs.

4. Business Objectives

Q1: What are the main objectives of businesses, and how do they vary by size or type?
A1: Objectives include profit, growth, CSR, and survival. Startups focus on survival, while large
firms aim for CSR and expansion.
Q2: Why might a business shift its focus from profit maximization to CSR?
A2: To build reputation, attract ethical customers, and ensure long-term sustainability.

Q3: How do external factors influence a business’s objectives?

A3: Economic downturns shift focus to survival; new technology prompts innovation.

Q4: Discuss the importance of setting SMART objectives in business planning.

A4: SMART objectives provide clarity, focus, and measurability for success tracking.

Q5: How do short-term objectives differ from long-term strategic goals?

A5: Short-term objectives focus on immediate issues; long-term goals aim for future growth and
vision.

5. Stakeholders in Business

Q1: Identify the key stakeholders in a business and their varying interests.
A1: Shareholders (profit), employees (job security), customers (quality), suppliers (contracts),
and governments (taxes).

Q2: How can businesses balance the interests of employees and shareholders?
A2: By offering fair wages while ensuring profitability.

Q3: What strategies can be used to resolve conflicts between stakeholders?

A3: Communication, negotiation, and compromise like profit-sharing.

Q4: Why is stakeholder engagement important in achieving business objectives?

A4: Engaged stakeholders support goals, fostering loyalty and cooperation.

Q5: How do customers and suppliers impact a business’s success?

A5: Customers drive revenue; suppliers ensure consistent production.

6. Human Resource Management (HRM)

1. What are the stages of the recruitment process?

Answer: Job analysis, advertising, shortlisting, interviewing, and onboarding.
2. Why is employee training important?
Answer: It improves skills, enhances productivity, and boosts employee morale and
retention.
3. What is the purpose of performance appraisals?
Answer: To evaluate employee performance, set goals, and identify areas for
improvement.
4. How can HRM improve employee retention?
Answer: By offering competitive benefits, growth opportunities, and a positive work
environment.
 5. What is workforce planning, and why is it critical?
Answer: Workforce planning ensures the right number of skilled employees are
available to meet business objectives.

7. Motivation

1. Compare Maslow’s hierarchy and Herzberg’s two-factor theory.

Answer:
○ Maslow: Focuses on fulfilling basic to self-actualization needs.
○ Herzberg: Differentiates hygiene factors (prevent dissatisfaction) and motivators
(drive satisfaction).
2. What are financial and non-financial motivators?
Answer:
○ Financial: Bonuses, salary raises.
○ Non-Financial: Job enrichment, recognition, flexible work hours.
3. Why is employee motivation critical for productivity?
Answer: Motivated employees are more productive, innovative, and loyal, leading to
better business outcomes.
4. What are the impacts of poor motivation?
Answer: Reduced productivity, high employee turnover, and negative customer
experiences.
5. How can managers boost employee morale?
Answer: By recognizing achievements, providing clear communication, and fostering a
positive workplace culture.

8. Management

1. What are the functions of management?

Answer: Planning, organizing, leading, and controlling resources.
2. How does leadership differ from management?
Answer: Leaders inspire and set vision, while managers implement and oversee
processes.
3. Why is effective communication crucial in management?
Answer: It ensures clarity, aligns team efforts, and reduces misunderstandings.
4. What is the importance of delegation in management?
Answer: It enhances efficiency, develops employee skills, and allows managers to focus
on strategic tasks.
5. How does decision-making impact business success?
Answer: Good decisions optimize resources and ensure long-term growth; poor
decisions can lead to losses.
9. The Nature of Market

1. What is the difference between a monopoly and perfect competition?

Answer: Monopoly has one dominant seller; perfect competition has many sellers with
no pricing power.
2. How do supply and demand affect market prices?
Answer: Prices rise when demand exceeds supply and fall when supply exceeds
demand.
3. What are the characteristics of a competitive market?
Answer: Many sellers, similar products, and price-driven competition.
4. How does government intervention impact markets?
Answer: Through subsidies, taxes, and regulations to control prices and ensure
fairness.
5. Why is market segmentation important?
Answer: It allows businesses to target specific customer groups effectively.

10. Market Research

1. What is the difference between primary and secondary market research?

Answer:
○ Primary Research: Data collected directly from the source (e.g., surveys,
interviews).
○ Secondary Research: Data gathered from existing sources (e.g., reports,
government data).
2. What are the benefits of using qualitative research?
Answer: Qualitative research provides deep insights into consumer behavior,
motivations, and attitudes, which can help refine marketing strategies.
3. How can businesses use market research to assess competition?
Answer: By analyzing competitors' strengths, weaknesses, pricing strategies, and
customer feedback to identify opportunities and threats in the market.
4. What are the limitations of market research?
Answer: It can be expensive, time-consuming, and sometimes inaccurate if the sample
size or data collection method is flawed.
5. How does technology improve market research?
Answer: Technology enables faster data collection, better analysis with tools like data
analytics software, and provides real-time insights into market trends.

11. The Marketing Mix - Product and Price

 1. What are the key components of the product element in the marketing mix?
Answer: Product design, quality, features, branding, packaging, and after-sales
services.
2. How does product differentiation help a business compete in the market?
Answer: By offering unique features or benefits that set the product apart from
competitors, it attracts customers and builds brand loyalty.
3. What factors influence the pricing decision for a product?
Answer: Costs, competitor pricing, customer demand, perceived value, and market
positioning.
4. How does price elasticity affect pricing strategies?
Answer: If demand is price-elastic, lowering prices increases demand; if inelastic, prices
can be higher without significantly affecting sales.
5. What is the role of psychological pricing in influencing consumer behavior?
Answer: Psychological pricing, like $9.99 instead of $10, can make a product appear
cheaper, influencing consumer purchase decisions.

12. The Marketing Mix - Promotion and Place

1. What are the primary methods of promotion in the marketing mix?

Answer: Advertising, sales promotions, public relations, direct marketing, and personal
selling.
2. How do businesses choose the right promotional mix?
Answer: By considering the target market, budget, goals, and effectiveness of each
promotional method.
3. What is the role of advertising in the marketing mix?
Answer: Advertising helps raise brand awareness, inform potential customers, and
influence purchase decisions.
4. How do distribution channels impact product availability and pricing?
Answer: Efficient distribution ensures products are available at the right time and place,
and can reduce costs, influencing the overall price.
5. Why is location important in the 'place' aspect of the marketing mix?
Answer: A good location increases customer accessibility, reduces costs, and enhances
brand presence, impacting overall sales and customer satisfaction.

13. The Nature of Operation

1. What is the difference between operations management and strategic

management?
Answer:
○ Operations Management: Focuses on day-to-day activities and processes to
produce goods/services.
 ○ Strategic Management: Long-term planning, aligning business goals, and
optimizing resources.
2. How do businesses improve operational efficiency?
Answer: By optimizing processes, reducing waste, implementing technology, and
training staff.
3. What is the importance of quality control in operations?
Answer: Quality control ensures products meet standards, reduces defects, and
enhances customer satisfaction.
4. How does technology affect operational efficiency?
Answer: Technology automates processes, improves accuracy, reduces labor costs,
and speeds up production, increasing overall efficiency.
5. What is the role of supply chain management in operations?
Answer: Effective supply chain management ensures raw materials, products, and
services are delivered on time and at the right cost, supporting smooth operations.

14. Inventory Management

1. What are the key objectives of inventory management?

Answer: To maintain optimal inventory levels, reduce carrying costs, ensure product
availability, and avoid stockouts or overstocking.
2. How does the Just-In-Time (JIT) inventory system work?
Answer: JIT minimizes inventory by ordering goods only when needed for production,
reducing storage costs and waste.
3. What is the Economic Order Quantity (EOQ), and how is it used?
Answer: EOQ calculates the optimal order quantity that minimizes total inventory costs,
including ordering and holding costs.
4. Why is accurate stock tracking important in inventory management?
Answer: Accurate tracking prevents stockouts, overstocking, and helps ensure
customer demand is met without excess inventory.
5. How do businesses determine reorder levels for inventory?
Answer: Reorder levels are based on average demand, lead time, and safety stock to
ensure products are available when needed without excessive stock.