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Paper 1
Business in the Real World
Both
Ownership choices affect control, risk, and funding.
Key Facts
- Revenue minus costs equals profit.
- Stakeholders include owners, employees, customers, suppliers, and the community.
- Risk and reward increase with larger investment.
Topics Covered
Business Purpose and Objectives
What you need to know
- •Profit, growth, survival, and social objectives.
- •Objectives can change as the business grows.
Exam Tips
- Always link objectives to stakeholder needs.
Ownership and Liability
What you need to know
- •Sole traders have unlimited liability.
- •Limited companies offer limited liability but more legal requirements.
Exam Tips
- Compare advantages and disadvantages in context.
Entrepreneurs
What you need to know
- •Entrepreneurs identify opportunities and take risks.
- •They need skills like leadership, creativity, and resilience.
Exam Tips
- Use a real business example if possible.
Key Terms
stakeholder
A person or group affected by a business.
limited liability
Owners lose only what they invest.
entrepreneur
Someone who starts a business and takes on risk.
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Common Exam Questions
Explain two objectives a start-up might have.
4 markseasyPaper 1
Model Answer
Survival to stay in business and growth to build market share.
What examiners want to see
- ✓Two objectives
- ✓Explanation
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