These eight questions use invented businesses, so you can practise the skills from the purpose and ownership cluster. Try each one before opening the answer.
Questions
Q1. A fictional charity runs a reading club for children and spends all fees on books. Is its objective profit or non-profit? Give a reason.
Answer
Non-profit, because it spends all income on its purpose and pays nothing to owners. See profit and non-profit objectives.
Q2. A shop earns RM18 000 and spends RM15 500. Calculate the surplus and say who keeps it in a profit-objective business.
Answer
RM18 000 − RM15 500 = RM2 500. In a profit-objective business, the owners keep it.
Q3. Name the form: one owner, full control, unlimited liability.
Answer
Sole proprietorship. See comparing ownership forms by features.
Q4. Two fictional firms each lose RM30 000, and each owner has put in RM6 000. Owner A has unlimited liability and Owner B has limited liability. How much more could Owner A lose?
Answer
Owner A may have to cover up to RM30 000. Owner B’s loss is generally limited to RM6 000. The difference is RM30 000 − RM6 000 = RM24 000.
Q5. State one difference between a private limited company and a public limited company.
Answer
A private limited company cannot offer its shares to the general public, while a public limited company may do so.
Q6. Two friends with RM20 000 together want to open a cafe needing RM35 000, and they want to share decisions. Which form suits them, what is the trade-off, and how large is the shortfall?
Answer
A partnership suits them, because they pool money and share decisions. The trade-off: partners generally share liability. Shortfall: RM35 000 − RM20 000 = RM15 000. See choosing a form for a fictional scenario.
Q7. Label the sector and activity of a fictional mobile phone repair stall.
Answer
Tertiary sector, because it provides a service. The activity is providing a service. See explaining scale, sector and business activity.
Q8. A student writes: “A bookshop is in the secondary sector because it sells books made in factories.” Correct it.
Answer
The bookshop only sells books, so it is in the tertiary sector and its activity is trading. The factory that makes the books is in the secondary sector.
If you got these wrong
Match each miss to a lesson and redo its worked example.
- Q1 and Q2: profit and non-profit objectives.
- Q3 to Q5: comparing ownership forms by features.
- Q6: choosing a form for a fictional scenario.
- Q7 and Q8: scale, sector and business activity.
Record each miss in the mistake log. If you want a teacher to go through your answers, see online one-to-one Business tuition.