Essay Questions (100 Marks) Question 1 You have decided to open a business and seeking for investors to invest in your business. You want to ensure that the capital pumped into your business by the investors has to produce more wealth for your firm. Investors will face losses if your business fail. However, if your business is a success, they will be rewarded. Describe the THREE (3) basic types of capital that entrepreneurs need and give example of hoe each capital is maximum utilised to your business success. (30 marks) Question 2 Hariharen has decided to initiate a textile business in a new area. He is confident that the business has potential to succeed. Unfortunately, he is not familiar with that business. His friends advised him to make an evaluation on the business prior to start-up. His friends also told him that entrepreneurs networking is an important component for the entrepreneurs to develop and establish their businesses. Explain the SIX (6) elements below of the industrial environment to be assessed by Hariharen before starting his business. i. Consumers ii. Competitors iii. Suppliers iv. Financial institutions v. Government agencies vi. Non-government organisations (30 marks) Question 3 Shahul Hamid is planning to buying an existing frozen food distribution company. However, he is a little sceptic on his decision as he isn't very sure of the issues involved in buying an existing frozen food distribution. Therefore, Shahul Hamid approached you to advise him on the advantages and disadvantages buying this business. Discuss the advantages and disadvantages below with Shahul Hamid before he decides to buy the existing company. Advantages a. Immediate operation b. Existing intangible assets c. Established group of employees and suppliers d. Quick Cash Flow Disadvantages a. Cost b. Location may have become unsatisfactory c. Inherited employees may be unsuitable d. Outstanding Contracts