Scribd
Upload
163 views2 pages

Understanding Business Fundamentals

This document provides an overview of key business concepts including the factors of production, added value, opportunity cost, and the dynamic business environment. It also discusses the roles of entrepreneurs and intrapreneurs. Factors for business success include understanding customer needs, efficient operations, flexible decision-making, and adequate financing. Conversely, factors for business failure include poor record keeping, lack of cash, and poor management skills. Entrepreneurs take on the responsibility of starting new businesses by investing savings and accepting risks.

Uploaded by

Riddhima Shah
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
163 views2 pages

Understanding Business Fundamentals

This document provides an overview of key business concepts including the factors of production, added value, opportunity cost, and the dynamic business environment. It also discusses the roles of entrepreneurs and intrapreneurs. Factors for business success include understanding customer needs, efficient operations, flexible decision-making, and adequate financing. Conversely, factors for business failure include poor record keeping, lack of cash, and poor management skills. Entrepreneurs take on the responsibility of starting new businesses by investing savings and accepting risks.

Uploaded by

Riddhima Shah
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

UNIT 1

BUSINESS AND ITS ENVIRONMENT

CHAPTER 1 ENTERPRISE

Business activity- it is the process of combining the factors of production to produce goods
and services and satisfy the needs and wants of customers.

Factors of production- resources needed to be able to operate and produce goods and services
CELL- capital, enterprise, land, labour.

Added value- the difference between the selling price and cost of bought-in materials

Opportunity cost- the next best alternative forgone- gov. hospital/school

Dynamic business environment- constantly changing


 New competitors
 Legal changes- safety regulations/limits
 Economic changes- consumers have less money to spend
 Technological changes- products are outdated

Business success
 Good understanding of customer needs- sales targets achieved
 Efficient management of operations- keeps costs under control
 Flexible decision-making to adapt to new situations
 Appropriate and sufficient sources of finance- prevents cash shortages and allows for
expansion.

Business failure
 Poor record keeping- not possible to remember everything, helps keep track
 Lack of cash- working capital needed for day-to-day transactions
 Poor management skills- may not have skills like leadership, decision making, cash
handling, cash management, planning, coordinating, communicating, marketing.
Promotion, selling

Role of entrepreneurs
 Have ideas for new businesses
 Create business plan
 Invest savings
 Accept responsibility of business
 Accept possible risks of failure

Intrapreneur-

Qualities of successful entrepreneurs and intrapreneurs


 Innovation
 Commitment and self-motivation
 Multi skilled
 Leadership skills
 Self-confidence and ability to bounce back
 Risk taking

You might also like