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4216740
Enterprise
Description
Mindmap of Enterprise, LC Economics
No tags specified
micro economics
factors of production
profit
junior certificate
Mind Map by
Jenny Marshall
, updated more than 1 year ago
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Created by
Jenny Marshall
almost 9 years ago
24
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Resource summary
Enterprise
1. Definition
Organises the other three factors of production in order to produce a good or service and takes all the risk in the hope of making a profit.
2. Return
Profit or Loss
3. How does Enterprise differ from the other Factors of Production?
It can earn a loss
Returns can vary
Return is residual
4. Risks involved in running a business
Insurable Risks
Non-Insurable Risks
5. Profits
Normal
Supernormal
Implicit and Explicit Costs
6. Why are profits important to a market economy?
Encourage risk taking
Indicate Consumer Demand
Encourage Investment
Provide Funds for Expansion
Continuity of Production
SNP Rewards Innovation
Govt Revenue
SNP may promote mergers
7. The Importance of Entrepreneurs in an Economy
Create Employment
Organise Production
Decide on Prices
Encourage further investment
Provide an investment outlet for savings
Govt Revenue
Create wealth
8. Rent of Ability
9. How can Enterprise be encouraged?
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