1.7

Question 1

Internal growth (organic)

Answer 1

Occurs when a business gets bigger by selling more of it’s products.

Question 2

External growth (intergration)

Answer 2

Occurs when a business gets bigger by joining or buying another business

Question 3

A franchise

Answer 3

Occurs when a franchisor sells the rihts of it’s products to a franchisee; this is usually in retuen for a fee and percentage of profits

Question 4

A franchisee

Answer 4

Buys a franchise usually in return for a fee and percentage of turnover

Question 5

E-commerce

Answer 5

The act of buying or selling a product using an electronic system such as the internet.

Question 6

Outsourcing

Answer 6

Occurs when a business uses another business to produce for it.

Question 7

Merger

Answer 7

Occurs when two or more businesses join together to form a new business

Question 8

A takeover

Answer 8

Occurs when one business buys control of another one.

Question 9

Economies of scale

Answer 9

Occurs when a businesses’ unit costs of production fall as its output rises and the business expands

Question 10

Diseconomies of scale

Answer 10

Occurs when the cost per unit increases and the business expands