TCE Year 11 Business Studies practice exams with worked answers

A business is an organisation that combines resources to produce goods or services for customers, usually with the aim of making a profit. In Australia, businesses perform both economic and social roles. Their economic roles include production (turning resources into goods and services people want), employment (paying wages that households then spend), investment (buying equipment, buildings and technology that expand future capacity) and enterprise (taking risks to start or grow ventures).

Their social roles include providing careers and skills, supporting local communities, sponsoring events and offering products that raise living standards. A regional employer may be the main source of jobs in a small Tasmanian town, so its decisions affect far more people than its owners.

Every business, whatever its size, carries out four key functions. Operations management converts inputs into outputs. Human resource management attracts, develops and keeps the people who do the work. Marketing management identifies customer needs and then designs, prices, promotes and distributes the product. Financial management plans, records and controls money so the business stays profitable and can pay its debts.

The functions are interdependent: a marketing campaign that lifts demand needs operations to produce more, HR to roster or hire staff, and finance to fund extra stock before customers pay.

Business goals are the broad outcomes a business wants; objectives are specific, measurable targets that move it towards those goals.

The course lists four goals and objectives: profit (revenue exceeding expenses), personal efficiency (the course's wording; read it as efficiency, which means using as few resources, including people's own time and effort, as possible for each unit of output), effectiveness (achieving intended results such as customer satisfaction or market share) and social responsibility (acting for the benefit of society and the environment beyond legal minimums).

Owners may also hold personal goals such as independence or family income, but the course does not list these as a separate goal. Goals can conflict, so managers must rank them.