AS unit 1.3: Size of Business

Question 1

why is measuring business size imp?

Answer 1

• measuring size is imp to assess how much a business has grown over years.
• mig (mangers,investors and govs) are interested in this measurement.

-even customers,particularly industrial customers wish to deal with larger businesses in certain cases.
assuming,perhaps,that they are more stable and less likely to cease production than smaller ones.

-Gov wishes to help smaller businesses while
investors compare the size of rival businesses to make investment decisions.

Question 2

There are two problems with these and other requirements for a way of measuring business size.

Answer 2

1. There are several different ways of
   measuring and comparing
   business size
   and they often give different comparative results.

A firm might appear large by one measure but quite small by another.

2.There is no internationally agreed definition
of what small,medium or large business is
but the number of employees is often used to make this distinction.

Question 3

What are the different measures of size?

Answer 3

1. Number of employees
2. Revenue
3. Capital Employed
4. Market Capitalisation
5. Market Share