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Business Studies > Business Activity > Flashcards

Business Activity Flashcards

1
Q

What is business activity?

A

anything to do with an organisation providing a service.

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2
Q

What are the risks of starting your own business?

A

financial, strained relations, mental health issues

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3
Q

What are the rewards of starting your own business?

A

financial, independence, self praise

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4
Q

What are aims in a business?

A

overall goal of a business.

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5
Q

What are business objectives?

A

the measurable targets of how to achieve aims

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6
Q

what is profit satisficing?

A

to make enough profit to keep owners happy.

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7
Q

What is a business plan?

A

these set out how the business intend to achieve objectives.

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8
Q

What is included in a business plan?

A
  1. the idea
  2. the people running the business
  3. market research
  4. finance
  5. objectives
  6. target market
  7. competition
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9
Q

What are advantages to a business plan?

A
  1. helps to raise finance
  2. measures performance
  3. staying organised/on task
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10
Q

What are disadvantages of business plans?

A
  1. plans need updating
  2. time to make the plans
  3. business plans don’t guarantee success
  4. plans are only as good as owners.
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11
Q

why are start up businesses risky?

A
  1. not much profit
  2. lack of knowledge
  3. competition
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12
Q

What is a sole trader?

A

a business controlled and owned by ONE person.

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13
Q

What are the advantages of a sole trader?

A
  1. keep all profits
  2. control over business
  3. easy to set up
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14
Q

what is a partnership?

A

a business owned by TWO or MORE people.

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15
Q

What is unlimited liability?

A

being responsible for all your debt

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16
Q

What is limited liability?

A

all debts are limited to what you have already put into business

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17
Q

What liability does a partnership have?

A

Unlimited Liability / limited liability partnership

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18
Q

what are shares?

A

a unit of ownership in a limited ltd (private limited company)

19
Q

What is a shareholder?

A

the owner of private and public companies.

20
Q

what is a public limited company?

A

a business that is legally allowed to sell its shares to the public.

21
Q

What is a private limited company?

A

a business that is run by its shareholders.

22
Q

Who can be a shareholder in a private limited company?

A

friends and family

23
Q

What is a dividend?

A

an annual payment paid from profits to shareholders.

24
Q

what is divorce of ownership and control?

A

when directors and shareholders disagree.

25
Q

What is maximisation?

A

increase revenue and decrease cost.

26
Q

What are benefits of business object?

A
  1. gives direction
  2. focus and motivation for employee
  3. a measurement for success.
27
Q

What are internal reasons for a business objective changing?

A
  1. an objective has been completed
  2. a change in views and needs of shareholders
  3. may want more ambitious objectives.
28
Q

What are external reasons for a business objective changing?

A
  1. new competitors arriving
  2. a change in economic environment
29
Q

what is a stake holder?

A

any person interested in business.

30
Q

What are examples of stake holders?

A
  1. staff
  2. competitors
  3. suppliers
  4. customers
  5. the media
31
Q

What is a merger?

A

two or more firms join to create new business.

32
Q

What is a takeover?

A

when a business buys another business.

33
Q

What is external growth?

A

focusing on the areas you don’t have direct control over

34
Q

What is internal growth?

A

occurs when a business expand it’s own activities by launching new products/entering new markets

35
Q

What are advantages of external growth?

A
  1. cost effective
  2. gain new customers
  3. eliminate competition
  4. more ideas.
36
Q

What are the four types of external growth?

A
  1. horizontal
  2. backwards
  3. forwards
  4. diversification
37
Q

What is horizontal integration?

A

a business joins another at same stage

38
Q

What is backwards integration?

A

a business joins at a previous stage.

39
Q

What is forward integration?

A

a business joins another at the next stage?

40
Q

what is diversification?

A

a business joins another at another stage.

41
Q

What is the primary sector?

A

taking materials from the earth (natural source)

42
Q

What is the secondary sector?

A

secondary stage of production. they use raw materials

43
Q

what is the ternary sector?

A

condensed with providing a service.

44
Q

What is Organic Growth?

A

When a business expands inside the business

Business Studies (6 decks)

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