Which of the following is a liability?

• Fixed assets
• Current assets
• Short-term debts
• Share value

The Acme Spring and Dynamite Company buys 400 pogo sticks for £4000 and sells each one for £35. How much is the total revenue?

• £35
• £14,000
• £10,000
• £10

What is the purpose of the margin of safety?

• It allows business to calculate the difference between variable costs and fixed costs
• It allows a business to identify how many more sales it must make before it reaches profitability
• It allows business to identify how far sales can fall before a loss is made
• It allows a business to calculate the gap between sales output and total costs

Which type of short-term loan allows a business to spend more money than they have available in their bank account?

• Loan
• Credit
• Overdraft
• Mortgage

What is meant by a "liability"?

• What it owes
• What it owns
• An asset
• A depreciated item

Which type of loan is not provided by a bank?

• Overdraft
• Fixed-term loan
• Mortgage
• Business grants

A business wishes to purchase a new machine and wishes to spread the repayments over several months. What type of finance is this?

• Trade credit
• Business loan
• Hire purchase
• Overdraft

Which of the following is an advantage of an entrepreneur investing their own savings into a business?

• The business is limited liability
• If the business fails, their savings are safe
• There is no cost to the business
• The entrepreneur is guaranteed a return on their investment

A business aims to increase its profitability by investing £15,000 over three years. During this time, it expects its profits to increase by a total of £24,000. What is the average rate of return?

• 16%
• 50%
• 100%
• 250%

What is meant by a "dividend"?

• A portion of profits paid to shareholders
• Part-ownership of a business
• The sale of additional shares in a business
• An annual meeting of shareholders