Key Business Concepts Explained

A trade barrier is a limit on the quantity of a good that can be imported into a country.

False

A fitness trainer provides her services to clients as a sole proprietorship. What are the tax implications for this structure?

Income earned by a sole proprietorship passes to the owner to be taxed.

A nonprofit corporation...

provides limited liability to its members.

Every marketing plan has five main strategy areas, the Five P’s.

• People
• Product
• Place
• Price
• Promotion

A royalty fee is a...

ongoing payment based on a percentage of sales.

Some creative works or inventions have the status of public domain when...

their copyright or patent has expired.

Credit Unions are related to make profits through loans.

False

What are the three C’s that must be addressed in all types of business plans?

• Concept
• Customers
• Capital

A sale is closed when...

The customer is satisfied, and the payment is made.

What challenges pose a business risk to entrepreneurs who want to conduct international trade?

Trade barriers, cultural differences between nations, and tariffs that must be paid to import goods.

A nonprofit corporation...

provides limited liability to its members.

Every marketing plan has five main strategy areas, the Five P’s.

• People
• Product
• Place
• Price
• Promotion

Some creative works or inventions have the status of public domain when...

their copyright or patent has expired.

A mission statement should include...

Why a company exists and guides a company’s work and actions.

Carrying capacity refers to...

the maximum number of companies an industry can support based on its potential customer base.

Social, economic, and political factors that could impact your business are called...

the business environment.

A well-written code of ethics...

All of the above.

Which of the following is true about a business plan?

It will need to be changed from time to time.

Which of the following is a risk to entrepreneurship?

Loss of investment.

Differentiators are unique characteristics that distinguish your business from other businesses.

True

The most successful salespeople...

know how to listen and ask questions.

A mobile lunch business is selecting a new location to place one of its lunch trucks. Which location has the best potential to generate the highest gross revenue over the next year?

An outdoor shopping mall with potential sales of $38,000 quarterly.

The cost reduction made possible by spreading costs over a larger volume is called...

economy of scale.

Successful entrepreneurs typically possess which three characteristics?

Responsible, Argumentative, and Adaptable.

Which works are protected by copyright?

Movies and songs.

A franchisee is...

An individual who uses the company's name and operations to run the same business in another location.

Companies that sell to other companies are called...

B2B.