What is the definition of a 'business model'?

A business model refers to the framework by which a company creates, delivers, and captures value. It essentially outlines how a business plans to generate revenues and make profits, detailing the various components such as target customers, value propositions, revenue streams, and cost structures. This comprehensive outline is crucial for the sustainability of a business.

The reason this choice is correct lies in its focus on the core purpose of a business: profitability. A well-defined business model enables an organization to understand its role in the marketplace and how it can effectively attract and retain customers while managing its costs to ultimately achieve its financial goals.

Other choices, while they may relate to aspects of running a business, do not capture the essence of what a business model truly is. The hiring and management of employees is a vital operational function but does not encapsulate the overall framework for profitability. Similarly, product research and development are important processes but are not comprehensive enough to represent the entire business strategy. Lastly, a financial document detailing expenses is an important financial tool but again lacks the broader scope that defines a business model's approach to revenue generation and profit-making.