The Multiple Choice Questions Blog

In 2021, the Patent Office granted 100 patents to Pear Ltd for new technologies that it might use in future Pear Phones.

Which one of the following is the main reason why Pear Ltd uses patents?

Select ONE answer:

1. Patents legally protect Pear Ltd’s ideas
2. A patent guarantees the commercial success of Pear Ltd
3. It is a legal requirement for producing mobile phones
4. UK patents are enforceable around the world

Show your workings to arrive at your answer, and explain and justify your reasons:

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This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – a patent is a legal document guaranteeing the holder the exclusive right to use or license inventions/innovations. It will help Pear Ltd to protect their technology being copied by bigger rivals. This will allow Pear Ltd to exploit inventions / innovations and gain a competitive advantage over rivals.
2. Not correct – because a patent cannot guarantee commercial success of a mobile phone because this will depend upon consumer demand, price and competitor actions
3. Not correct – because whilst patents may be a sensible precaution they are not a legal requirement to produce mobile phones
4. Not correct – because patents are only enforceable in the country in which they are issued

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Alex Sportswear produce a range of footwear for men, women, children, different sports and other leisure activities.

The most likely reason for Alex to use market segmentation is to …. ?

Select ONE answer:

1. more effectively target its market
2. reduce the need for market research
3. avoid the need to advertise
4. reduce the range of products being offered

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – Market segmentation is the process of dividing a market up into different groups of customers. In a segmented market, customers are more likely to buy products that are made to match their needs, thus increasing Alex’s sales. This increases profitability and reduces the threat of direct competition.
2. Not correct – because Alex will still need to carry out market research into what the different market segments would require
3. Not correct – because Alex will still need to advertise in order to increase awareness of its products to different segments
4. Not correct – because market segmentation increases the range of products as the needs of different segments are identified and provided for

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Alex Market Research carries out product trials on behalf of some of the biggest retail brands in the UK seeing what new products works well with retail customers in Staffordshire.

Businesses carry out product trials for new products to…?

Select ONE answer:

1. guarantee sales
2. reduce their margin of safety
3. assess the likely levels of demand
4. gather secondary research

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct – because product trials do not guarantee sales as they do not take other factors into consideration e.g. competition
2. Not correct – because product trials should increase the margin of safety not reduce it because consumers are more likely to purchase a product if they have already tried it as a free sample
3. Correct – Product trials is launching a product on a limited scale to measure initial reactions. Feedback from customers can be used to adapt or modify the product. This will increase the likelihood of successful sales when the product is launched on a national basis.
4. Not correct – because products trials are a method of primary research because they collect first hand information

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Lucy is the founder of Guinea Pig Love, a very successful global brand. She has won many awards including Staffordshire Young Entrepreneur of the Year in 2021.

Which one of the following is least likely to be a characteristic of a successful entrepreneur?

Select ONE answer:

1. Self-confident
2. Risk-taker
3. Resilient
4. Indecisive

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct – because an entrepreneur has to be self-confident and believe in their ideas and decision making, particularly when faced with difficult choices/decisions.
2. Not correct – because entrepreneurs do take risks which are balanced against rewards.
3. Not correct – because resilience means not giving up, which is crucial for a successful entrepreneur as businesses often struggle/fail, especially in the first year.
4. Correct – what is an entrepreneur e.g. someone who combines the factors of production in order to create a business/willingness to take risks involved in running a business. Many successful entrepreneurs have to be able to make many quick decisions for the survival of their business. If decisions are not made quickly vital opportunities would be lost thereby risking the success of the business.

This work is licensed under a Creative Commons Attribution 4.0 International License.