Business exam
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Business exam - Leaderboard
Business exam - Details
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185 questions
| 🇬🇧 | 🇬🇧 |
| Objectives of public sector businesses | Financial, service, social |
| Franchises | A business based upon the use of the brand names, promotional logos, and trading methods of an existing successful business |
| Factors of production | Resources needed to produce goods or services |
| The 4 factors of production | Land (natural resources provided by nature), labour (number of people available to make products), capital (things needed to manufacture goods), enterprise (entrepreneurs/business owner) |
| Opportunity cost | Is the next best alternative given up by choosing another item |
| Franchises | A business based upon the use of the brand names, promotional logos, and trading methods of an existing successful business |
| Importance of specialisation | Allow people to be very good at one thing, which increases efficency |
| Advantages of division of labour | Quicker and cheaper to train workers as fewer skills taught, less time wasted, workers are trained in one task so they are very good at it |
| Disadvantages of division of labour | Harder to replace, workers might get bored |
| Franchises | A business based upon the use of the brand names, promotional logos, and trading methods of an existing successful business |
| Needs | Is a good or service which is essential to living |
| Division of labour | Production process is split up into different tasks and each worker performs a tast |
| Wants | Good or service which people would like to have but isn't essential for living, people's wants are unlimited |
| Scarcity | Lack of sufficient products to fulfil the total wants to the population |
| Specialisation | When people and businesses concentrate on what they are best at |
| Importance of specialisation | Specialised machinery and technologies are now widely available , increasing competition means that businesses have to keep costs low |
| Added value | Difference between selling price and materials and bought in costs |
| How added value can be increased | Increase sale price and try to reduce the costs of materials |
| Primary sector | Extracts and uses natural resources to produce raw materials (woodcutter) |
| Secondary sector | Manufactures goods using raw materials from primary sector (furniture maker) |
| Tertiary sector | Provides services to consumers and the other sectors (retailer) |
| De-industrialisation | When there is a decline in the importance of the secondary sector of industry in a country |
| Private sector | Businesses not owned by the government |
| Public sector | Businesses owned and controlled by the government |
| Mixed economy | Both public and private sectors |
| Capital | Money invested in the business by the owners |
| Reasons for the changing importance of business classification | Sources of primary products become depleted, developed countries are losing competitiveness in manufacturing to newly industrialised countries like China |
| Public sector | Businesses owned and controlled by the government, will make their own decisions about what and how to produce and price, some goods and services are provided free of charge like health which is paid for by the taxpayer |
| Private sector | Businesses not owned by government these businesses will make their own decisions about what and how to produce and price |
| Mixed economy | Has both a private sector and a public sector |
| Entrepreneur | Organises, operated and takes the risk for a new business venture |
| Advantages of being an entrepreneur | Independence, may become successful if the business grows, use your own ideas |
| Characteristics of successful entrepreneurs | Innovative, creative, independent, optimistic, hard worker |
| Contents of a business plan | Description of the business, products and services, the market the business is targeting, financial information |
| How business plans assist entrepreneurs | They are forces to think ahead and plan out their business carefully which can help them get a loan |
| Why governments support business start-ups | Reduce unemployment, increase competition, benefit society |
| How governments support business start-ups | Grants, training, research |
| Capital employed | Total value of capital used in the business |
| Methods to compare business sizes | Number of people employed, value of output, value of sales |
| Limitations for number of people employed, value of output, value of sales | Some firms use production methods that employee few people but produce high output levels, a high level of output does not mean a business is large, could be misleading because of higher end products |
| Comparing business size is useful to who | Investors, governments, workers |
| Why owers might want to expand a business | Possibility of higher products, larger share of the market, lower average cost |
| Different ways a business can grow | Internal, external involving a takeover or a merger |
| 3 examples of external growth | Horizontal merger, vertical merger, conglomerate intergration |
| Problems linked to business growth and how these might be overcome | Larger business is difficult to control (operate the business in small units), cost of expansion (expand more slowly), larger business leads to poor communication (operate the business in small units) |
| Internal growth | When a business expands its exisiting operations |
| External growth | A business takes over or merges with another business, often called intergration |
| Horizontal integration | A business merges with/takes over another business in the same industry at the same stage of production |
| Vertical integration | A business merges with/takes over another business in the same industry but at a different stage of production, can be backwards or forwards |
| Conglomerate integration | A business merges with/takes over another business in a different industry |
| Business plans uses | Help gain finance, careful planning reduces risk |
| Causes of business failure | Lack of management skills, changes in business environment, over expansion |
| Why some businesses remain small | The type of industry the business operates on, market size, owners objectives |
| Why governments support business star-ups | Reduce unemployment, benefit society, increase competiton |
| Why new businesses are at a greater risk of failing | Lack of finance, poor planning, owners of a business may lack experience and decision-making skills |
| Sole trader | Business owned by one person |
| Partnership | Is a form of business in which two or more people agree to jointly own a business |
| Private limited company | Businesses owner by shareholders, but they cannot sell shares to the public |
| Public limited company | Businesses owner by shareholders, but they can sell shares to the public |
| Advantages of a sole trader | Has complete control over the business, incentive to work hard because he can keep all the profits, can choose which hours he works |
| Disadvantages of a sole trader | Unlimited liability, if owner is sick nobody will take care of business, no more capital invested |
| Disadvantages of a partnership | Share profits, have disagreements, different ways of managing a business (culture) |
| Advantages of a partnership | More capital invested, share ideas, the business will continue to run if you're sick |
| Franchises | A business based upon the use of the brand names, promotional logos, and trading methods of an existing successful business |
| Joint ventures | 2 or more businesses start a new project together sharing capital, risks and profits |
| Limited liability | You only have to pay back the capital you invested in the business |
| Limited liability | You only have to pay back the capital you invested in the business |
| Unlimited liability | You have to pay back all the debts the business might have |
| Incorporated business | Companies that have separate legal status from their owners |
| Private limited companies | Businesses owner by shareholders, but they cannot sell shares to the public |
| Francise | A business based upon the use of the brand names, promotional logos, and trading methods of an existing successful business |
| Unincorporated business | The business does not have a separate legal identity to the owner, so if the owner dies the business will not continue to run |
| Private limited company | Businesses owned by shareholders but they cannot sell shares to the public |
| Public limited companies | Businesses owner by shareholders, but they can sell shares to the public |
| Public limited company | Are businesses owned by shareholders, but they can sell shares to the public and their shares are tradeable on their stock exchange |
| Sole trader risk, ownership and limited liability | Carried by one sole owner, one person, no |
| Annual general meeting | Shareholders can vote on who they want to be on the board of directors |
| Dividends | Payments made to shareholders from the profits of a company |
| Partnership risk, ownership and limited liability | Carried by all partners, several partners, no |
| Advantages to the franchisor | Expansion is faster, management of the outlet is the responsibility of franchisee, franchisee has to buy the use of the brand name |
| Disadvantages to the franchisor | Franchisee keeps all the profits, poor management can lead to a bad reputation for the brand, pay for advertising |
| Advantages to the franchisee | Franchisor pays for advertising, chances of business failure are reduced, training for staff is provided by manager |
| Disadvantages to the franchisee | License fee must be paid to the franchisor, cannot change products to suit area/locally, less independence |
| Market share | Percentage of total market sales held by one brand or business |
| Private limited company risk, ownership and limited liability | Shareholders up to their original investment, shareholders - may be few or many but shares cannot be sold to the public, yes |
| Public limited company risk, ownership and limited liability | Shareholders up to their original investment, many shareholders (can be millions), yes |
| Business organisations in the public sector | Public corporations |
| Joint venture | 2 or more businesses start a new project together sharing capital, risks and profits |
| Public corporations | Businesses in the public sector that is owned and controlled by the state |
| Need for business objectives | Give workers and managers a clear target, can focus decisions, managers can compare if the business has been successful |
| Business objectives | Aims or targets that a business works towards |
| Different business objective examples | Survival, growth, profit, market share |
| Social enterprise objectives | Has social objectives as well as an aim to make a profit to reinvent back into the business |
| Stakeholder | Any person or group with a direct interest in the performance and activities of a business |
| Community stakeholders aims | Jobs, clean environment, safe products |
| Government stakeholders aims | Employment, taxes, increasing national output |
| Workers stakeholders aims | Income, job security |
| Managers stakeholders aims | Salaries, status, control |
| Owners stakeholders aims | Profits, return on capital |
| Customers stakeholders aims | Goods and services, quality, good value |