Question detail
Harbour Hire serves small retailers while taking a loan; the case evidence includes capacity utilisation of ?6,727, sales of 827 units, and a 30% change in costs or demand. Which option best applies Explain why entrepreneurs embark on running businesses despite risk?
Try the question, check the answer, then read the explanation to understand the curriculum point.
At a glance
MCQ
Type
practice
Style
Topic
Competitive environment
Question
- A. Use risk, entrepreneur to judge customer retention, shareholders impact, and the business objective in Uncertainty and risk.
- B. Give only a definition of Competitive environment 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 risk, entrepreneur to judge customer retention, shareholders impact, and the business objective in Uncertainty and risk.
Explanation
The answer is commercially strongest because Use risk, entrepreneur to judge customer retention, shareholders impact, and the business objective in Uncertainty and risk. The case evidence gives ?8,227, 827 units, and 30%, 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
Uncertainty and risk common mistake 1
Giving a vague answer instead of directly addressing: Explain why entrepreneurs embark on running businesses despite risk..
Answer by clearly explaining how to explain why entrepreneurs embark on running businesses despite risk..
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