1.3 Flashcards

1
Q

what is cash outlfow?

A

money leaving the business

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1
Q

what is cash inflow?

A

money going into the business(e.g from sales)

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2
Q

benefits of a business plan?

A

helps you predict problems,determines the success of the business

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3
Q

what does a business plan include?

A

company description,products and services,market analysis,marketing strategy,budget

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4
Q

whats market mapping?

A

using a graph to plot competitors and their products to try and spot a gap in the market

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5
Q

advantage of venture capital

A

access to substantial funds

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6
Q

advantage of personal savings

A

immediate access

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7
Q

disadvantage of venture capital

A

requires sharing profit with investors

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8
Q

disadvantage of personal savings

A

risk of personal financial loss

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9
Q

example of short term finance

A

trade credit,overdrafts

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10
Q

example of long term finance

A

venture capital,crowdfunding,bank loan

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11
Q

what are fixed costs

A

costs a business must pay no matter how many goods they make/sell e.g wages,rent

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12
Q

what are variable costs

A

raw materials

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13
Q

benefits of a bank loan

A

large amounts of amountd can be borrowed

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14
Q

disadvantages of a bank loan

A

interest must be paid regardless of business performance

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15
Q

advantages of trade credit

A

improves cash flow

16
Q

disadvantages of trade credit

A

risk of damaging supplier relationship if not paid on time

17
Q

whats crowdfunding

A

Crowdfunding involves a large number of people investing small amounts of money in a business, usually online.

18
Q

whats venture capital

A

Venture capital is money invested by an individual or group that is willing to take the risk of funding a new business in exchange for an agreed share of the profits.

19
Q

whats share capital

A

Share capital is the money invested in a company by the shareholders.