4216740
Description
Mind Map by Jenny Marshall, updated more than 1 year ago
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Created by Jenny Marshall
over 8 years ago
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Enterprise
- 1. Definition
- Organises the other three factors of production in order to produce a good or service and takes all the risk in the hope of making a profit.
- Organises the other three factors of production in order to produce a good or service and takes all the risk in the hope of making a profit.
- 2. Return
- Profit or Loss
- Profit or Loss
- 3. How does Enterprise differ from the other Factors of Production?
- It can earn a loss
- Returns can vary
- Return is residual
- Return is residual
- Returns can vary
- It can earn a loss
- 4. Risks involved in running a business
- Insurable Risks
- Non-Insurable Risks
- Insurable Risks
- 5. Profits
- Normal
- Supernormal
- Implicit and Explicit Costs
- Normal
- 6. Why are profits important to a market economy?
- Encourage risk taking
- Indicate Consumer Demand
- Encourage Investment
- Provide Funds for Expansion
- Continuity of Production
- SNP Rewards Innovation
- Govt Revenue
- SNP may promote mergers
- Encourage risk taking
- 7. The Importance of Entrepreneurs in an Economy
- Create Employment
- Organise Production
- Decide on Prices
- Encourage further investment
- Provide an investment outlet for savings
- Govt Revenue
- Create wealth
- Create Employment
- 8. Rent of Ability
- 9. How can Enterprise be encouraged?
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