The impact of risk and reward on business activity:
● risk: business failure, financial loss, lack of security
● reward: business success, profit, independence.
Discover
Delve
Demonstrate Question
This question is an explain question. You MUST use the BLT format. An example is below for a different explain question. The structure of your answer should match the example.
Explain an advantage of having limited liability. (3 marks).
One advantage is that you only risk losing the money you invest in the business.
This is because you and your business have separate legal identities.
This leads to being being more willing to take risks with business.
Therefore having greater returns when those risks are successful.
Have a go at your own
Explain one risk an entrepreneur takes when starting a new business.
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Mark Scheme
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