Topics: Entrepreneurship, Entrepreneur, Factors of production Pages: 4 (743 words) Published: February 8, 2013
BUS 110 – Chapter 1 Homework

***Read Chapter 1 from your textbook and answer the following questions.***

Q1 – What is the difference between revenue and profit?

A1 – Revenue is the total amount of money that a business takes in during a given period by selling goods and services. Profit is the amount of money a business earns above and beyond what it spends for salaries and other expenses, which is to use revenue to minus salaries and expenses.

Q2 – What is the difference between standard of living and quality of life?

A2 – The term of standard of living refers to the amount of goods and services people can buy with the money they have. Standard of living is the physical measurement of people's living.

Q3 – What is risk, and how is it related to profit?

A3 – Risk is the chance an entrepreneur takes of losing time and money on a business that may not prove profitable. The more risk that business people take, the more profit that business people may have.

Q4 – What do the terms stakeholders, outsourcing, and insourcing mean?

A4 – Stakeholders refer to all the people who stand to gain or lose by the policies and activities of a business and whose concerns the business needs to address.

Outsourcing means that contracting with other companies to do some or all of the function of a firm, like its production or accounting tasks.

Insourcing means that the company internally do some or all of the functions of a firm, like its production or accounting tasks.

Q5 – What are some of the advantages of working for others?

A5 –Somebody else assumes the company's entrepreneurial risk and provides you with benefits., like paid vacation time and health insurance.

The company you work for will provide the tools and technology to make your job more productive.

Q6 – What benefits do you lose by being an entrepreneur, and what do you gain?

A6 – As an entrepreneur, you do not receive any benefits such as paid vacation time, and you have...
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