Lucy is looking to open another jewelry store across town and is in the process of preparing a business plan to help her make the decision one way or another.
Which one of the following is a reason to produce a business plan?
Select ONE answer:
- To reduce the chance of the business failing
- To include personal details of staff who will be employed
- To provide an opportunity to attract more customers
- To guarantee that the business makes a profit
Show the workings to arrive at your answer, and explain and justify your reasons:
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This multiple choice question is suitable for Business Studies KS4 & KS3 classes
The answer is 1:
- Reduces the chance of the business failing – is correct because a business plan gives details of cash flow that can reduce the potential of a business failing.
- To include personal details of staff who will be employed – is not correct because a business plan would not include personal details.
- Provides an opportunity to attract more customers – is not correct because customers will not see the business plan.
- Guarantees that the business makes a profit – is not correct because a business plan can estimate profits but cannot guarantee them.
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