1.3 Putting A Business Idea into Practice Flashcards
<p>What is an <b>aim</b>?</p>
<p>An aim is the goals a business wants to achieve in the future</p>
<p>What is an <b>objective</b>?</p>
<p>An objective are the steps a business takes to achieve an aim</p>
<p>How do you calculate <b>revenue</b>?</p>
<p>Revenue = quanitity sold × Selling Price</p>
<p>What is <b>revenue</b>?</p>
<p>Revenue is the income earned by a business from the sale of its goods and services</p>
<p>What are <b>fixed costs</b>?</p>
<p>Fixed costs are costs that do not vary with the output of the business</p>
<p>What are <b>variable costs</b>?</p>
<p>Variable costs are costs that do directly vary with output</p>
<p>Name some examples of fixed costs</p>
<ul><li>Rent</li><li>Insurance</li><li>Salaries</li></ul>
<p>What are examples of variable costs?</p>
<ul><li>Wages</li><li>Raw Materials</li><li>Transportation</li></ul>
<p>How do you calculate total costs?</p>
<p>Total Costs = Fixed Costs + Variable Costs</p>
<p>What is <b>profit</b>?</p>
<p>Profit is the amount of money the business makes, whilst taking costs into account </p>
<p>How do you calculate profits?</p>
<p>Profit = total revenue - total costs</p>
<p>What is a <b>loss</b>?</p>
<p>A loss is when total costs are greater than the total revenue</p>
<p>What is a <b>profit</b>?</p>
<p>A porfit is when total revenue is greater than the total costs</p>
<p>How do you calculate <b>average unit cost</b>?</p>
<p>Average unit cost = total cost / output</p>
<p>What is <b>interest</b>?</p>
<p>Interest is the amount of extra money you pay back from money you have borrowed</p>