ENTREPRENEURSHIP

Detailed explanation-1: -The answer is b. Capital is not required for a new business since it already exists. Using additional capital to purchase the business limits one’s total capital, which is considered a disadvantage. In business, it’s important to retain as much capital as possible for future investments.

Detailed explanation-2: -A disadvantage of buying an existing business is that the industry may be experiencing difficulties or uncertainty, creating an element of risk for your investment. Another potential disadvantage of buying an existing business is that you may experience additional costs such as updating machinery.

Detailed explanation-3: -The advantages this presents to you as the new business owner include the following. The business and everything involved with its operation is sold to the purchaser to continue running the business. The business can continue running as it has been prior to the sale. There are no immediate financial issues to overcome.

Detailed explanation-4: -Better financing options. Already established brand. Existing customers. Well-established supply chain. Access to trained staff and proven internal processes. More financial reward in growth. Greater likelihood of success. 29-Aug-2019