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Business GCSE > Business activity > Flashcards

Business activity Flashcards

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1
Q

What are three purposes of business enterprise and entrepreneurship?

A

spotting an opportunity
developing an idea
satisfying customer needs

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2
Q

describe spotting an opportunity?

A

spotting a gap in the market and improving a product or service already provided or producing a product or service more cheaply

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3
Q

describe developing an idea?

A

designing the product or service and planning production

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4
Q

describe satisfying customer needs?

A

producing the product or providing the service and marketing the product or service

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5
Q

what is the definition of an entrepreneur?

A

a person who takes the risk of starting and running a business enterprise

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6
Q

what is the definition of spotting an opportunity?

A

the ability to see the need for a particular product or service customers’ needs

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7
Q

what are the four main characteristics of entrepreneurs?

A

creativity
confidence
risk-taking
determination

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8
Q

what is a financial risk of being an entrepreneur?

A

if the business does not succeed, the risk of losing savings (and other assets) to pay off debts

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9
Q

what is a financial reward of being an entrepreneur?

A

the potential of making a lot of money

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10
Q

what is a non-financial risk of an entrepreneur?

A

health - the strain of running a business can cause mental and physical illness.

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11
Q

what are three non-financial rewards of an entrepreneur?

A

independence
self-satisfaction
making a difference

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12
Q

why should a business plan its activities?

A

reduce risk of failure
be as successful as possible

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13
Q

what are the five steps that are involved in a business plan?

A

the idea
the people
market research
finance
competitors

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14
Q

what are aims and objectives?

A

statements of what the business is trying to achieve

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15
Q

what is a business plan?

A

a simple plan which sets out details of the product or service being sold and how it will be financed, marketed and details of market research findings

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16
Q

what is finance?

A

a business word used instead of money. the finance needed to start a business is the money required to buy the resources needed

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17
Q

what are markets?

A

where a business sells its goods or services

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18
Q

what are resources?

A

the things a business needs to make it work, including staff and materials

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19
Q

when is a business plan needed?

A

before the business starts or at a major change within the business

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20
Q

what is a SMART target?

A

specific
measurable
achievable
realistic
timely

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21
Q

what is the definition of operate?

A

a term used to explain how a business works

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22
Q

what are the 4 things needed in a business plan to show how the business plans on reaching its targets?

A

identifying the market (age, gender and income)
identifying the resources
identifying the finance needed
achieve the business’ aims and objectives

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23
Q

what are the four types of business ownership?

A

sole traders
partnerships
private limited companies
public limited companies

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24
Q

what is a deed of partnership?

A

a document stating who owns the partnership, how much money each partner has invested and their role in the business

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25
Q

what is a private limited company? (Ltd)

A

usually a smaller business, it can sell its shares to invited people only

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26
Q

what is a public limited company? (plc)

A

it can sell shares to anyone who wants to buy

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27
Q

what is a share?

A

part ownership of a business

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28
Q

what types of ownerships are easy to set up?

A

sole traders
partnerships

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29
Q

what types of ownerships are easy for the owner(s) to control?

A

sole traders
partnerships
private limited companies

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30
Q

what types of ownerships have continuity?

A

private limited companies
public limited companies

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31
Q

what types of ownerships have their information kept private?

A

sole traders
partnerships

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32
Q

what types of ownerships involve in raising finance?

A

Ltd
plc

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33
Q

what types of ownerships have limited liability?

A

Ltd
plc

34
Q

what types of ownerships may suffer with workload?

A

sole traders

35
Q

what is limited liability?

A

the owners of a business can only lose the money they have invested in a business if it fails

36
Q

what is unlimited liability?

A

the owner of a business is responsible for repaying all the debts of a business

37
Q

what is the effect of limited liability on the owner?

A

the shareholders of the business do not have to risk their own savings or personal possessions to pay off debt

38
Q

what is the effect of unlimited liability on the owner?

A

the business must pay back the debts using the businesses assets

39
Q

what is the effect of limited liability on the business?

A

it helps business raise extra finance because investors know that they aren’t going to lose any of their savings or assets

40
Q

what is the effect of unlimited liability on the business?

A

can limit the creation and expansion of sole trader and partnership businesses

41
Q

what is the definition of assets?

A

items owned by the business such as buildings and vehicles

42
Q

what is an established business?

A

a business that has been trading for a long time

43
Q

what are start-ups?

A

new businesses that are just beginning

44
Q

what is a sole trader business suitable for?

A

start-ups that only need a small amount of finance

45
Q

what is a partnership business suitable for?

A

start-ups or existing businesses that want to grow

46
Q

what are private limited companies suitable for?

A

start-ups and established businesses wanting to grow

47
Q

what are public limited companies suitable for?

A

establishes businesses that want to grow and need large amounts of finance

48
Q

what are 4 business objectives?

A

survival
profit
growth
providing a service

49
Q

what is the definition of evolving?

A

refers to the way a business develops and changes over time, by becoming bigger or smaller and by selling different goods and services or a wider range, as well as selling in different places and in different ways

50
Q

what are stakeholders?

A

groups or individuals who have an interest in a business

51
Q

what is the definition of external stakeholder?

A

the local community, suppliers, customers and government

52
Q

what is the definition of internal stakeholdrs?

A

the business owners and the people who work in the business

53
Q

what are the roles of owners?

A

provide finance to start up and expand
may manage or run the business

54
Q

what are the objectives of owners?

A

make profit

55
Q

what are the roles of employees?

A

produce goods and services

56
Q

what are the objectives of employees?

A

satisfaction of earning income

57
Q

what are the roles of customers?

A

buy goods and services

58
Q

what are the objectives of customers?

A

enjoy the benefits provided by goods and services
pay affordable prices

59
Q

what are the roles of suppliers?

A

sell goods for resale and components and materials needed to manufacture goods or provide services

60
Q

what are the objectives of suppliers?

A

make sales
earn profit

61
Q

what are the roles of the government?

A

help businesses, workers and communities

62
Q

what are the objectives of the government?

A

encourage business as this leads to high employment and prosperous communities
this increases the taxes paid to the government

63
Q

what are the roles of the local community?

A

provide workers
monitor and influence business activities

64
Q

what are the objectives of the local community?

A

have a local area which is prosperous, healthy and safe

65
Q

a positive and a negative to owners of business activity?

A

earn profits if the business is successful
may lose money invested in the business

66
Q

a positive and a negative to employees of business activity?

A

able to earn an income
may be made redundant

67
Q

a positive and a negative to suppliers of business activity?

A

sell their goods to another business and earning profit from doing so
may lose money if the business does not pay for goods supplied

68
Q

a positive and a negative to the government of business activity?

A

receive tax revenue
very large companies may become ‘too big to fail’ - the government may be criticised if they do and the government doesn’t step in to help

69
Q

a positive and a negative to the local community of business activity?

A

people in the community can earn money from jobs
the community can be affected by negative externalities such as pollution and road congestion

70
Q

what does business failure mean?

A

that can be indicated by losses, low sales, poor quality goods and services

71
Q

what does business success mean?

A

this may be measured in terms of profit, growth, sales, returning customers and a positive contribution to the local community

72
Q

what is the definition of capacity?

A

for a factory or shop, capacity refers to how much output it can produce or sell

73
Q

what is the definition of organic growth?

A

concerned with the internal growth of a business, for example, by increasing its sales

74
Q

what are four types of organic growth?

A

increasing output
gaining new customers
increasing market share
developing new products

75
Q

what is the definition of external growth?

A

the growth of a business by takeover or merger

76
Q

what is backwards vertical growth?

A

what a business merges with, or takes over, a business that supplies it with goods or services

77
Q

what is diversification?

A

what a business merges with or takes over another business with which it has no connection

78
Q

what is forward vertical growth?

A

when a business merges with, or takes over, a business that it supplies goods or services to

79
Q

what is horizontal growth?

A

a merger or takeover where the two businesses are involved in a similar operation

80
Q

what is a merger?

A

where two or more businesses agree to joint to become one business

81
Q

what is a takeover?

A

where a business takes a controlling interest in another business, for example, by buying more than 50% of the shares in it

Business GCSE (7 decks)

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