Question detail
CycleNest serves price-sensitive customers while using retained profit; the case evidence includes break-even output of ?1,919, sales of 299 units, and a 36% change in costs or demand. Which option best applies Explain what a business is and why businesses may start, including producing goods, supplying services, distributing products, fulfilling opportunities and benefiting others?
Try the question, check the answer, then read the explanation to understand the curriculum point.
At a glance
MCQ
Type
practice
Style
Topic
The purpose and nature of businesses
Question
- A. Use services, business, goods to judge break-even output, shareholders impact, and the business objective in Business purpose, goods and services.
- B. Give only a definition of The purpose and nature of businesses without using the case evidence.
- C. Treat margin and markup as identical and ignore the effect on shareholders.
- D. Choose the largest sales figure without checking costs, finance, or context.
Answer
The correct option is: Use services, business, goods to judge break-even output, shareholders impact, and the business objective in Business purpose, goods and services.
Explanation
The answer is commercially strongest because Use services, business, goods to judge break-even output, shareholders impact, and the business objective in Business purpose, goods and services. The case evidence gives ?3,419, 299 units, and 36%, so the answer must explain the commercial effect rather than repeat a definition. The distractors are weaker because they confuse margin and markup, miss the shareholders, or ignore the business objective.
Common mistake
Business purpose, goods and services common mistake 1
Giving a vague answer instead of directly addressing: Explain what a business is and why businesses may start, including producing goods, supplying services, distributing products, fulfilling opportunities and benefiting others..
Answer by clearly explaining how to explain what a business is and why businesses may start, including producing goods, supplying services, distributing products, fulfilling opportunities and benefiting others..
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