1.5 Business Objectives

Question 1

Survival

Answer 1

To continue to exist as a business

Small Business Objective

May set a cash flow objective to ensure sufficient cash is available

Question 2

Profit maximisation

Answer 2

An output level that achieves the highest amount of profit attainable

Basic profit = revenue- costs of sale

Question 3

Sales maximisation

Answer 3

Highest achievable amount of sales either by volume or value

Volume is the amount of units

Sales value is expressed as the total sum of money spent by customers top

Question 4

Market share

Answer 4

Market share is the proportion of total market sales that a firm has this can be calculated as:

Business sales A sales / market sales X 100

Question 5

Cost efficiency

Answer 5

To control costs so that the maximum value of outputs is achievable with the lowest value of inputs

Question 6

Employee welfare

Answer 6

To look after the economic and physical well-being of the workforce

Question 7

Customer satisfaction

Answer 7

To ensure that goods and services meet the needs and expectations of the customer

Question 8

Social

Answer 8

To behave in a way that benefits society