Business activity

Question 1

forwards vertical intergration

Answer 1

when a business takes over another business to control the direct
distribution of a business product

Question 2

consumer good

Answer 2

a good sold to the public for use by them

Question 3

producer good

Answer 3

a good sold to another business

Question 4

conglomerate intergration

Answer 4

when a business joins with another in a different type of production process

Question 5

horizontal integration

Answer 5

they buying or merger of another businesses producing the same or similar products

Question 6

vertical backwards integration

Answer 6

when the suppliers of a business are taken over by that business

Question 7

tertiary

Answer 7

service/ sold (retail)

Question 8

secondary sector

Answer 8

production- making it

Question 9

primary sector

Answer 9

extractions of raw materials (farming, fishing)

Question 10

private sector

Answer 10

includes all businesses owned by private individuals

Question 11

public sector

Answer 11

• paid for by public via tax
• these are NHS, armed forces

Question 12

personal direct services

Answer 12

• aimed at consumers
• example in personal trainer, hairdressers

Question 13

non durable goods

Answer 13

these are goods which are only used or consumed a single time

consumer= milk , veg
producer= oil chemicals

Question 14

durable goods

Answer 14

these are goods that have a long life, they will be used until they break or are replaced
producer= car engines
consumer= tv, shoes

Question 15

what are the rewards of being an entrepreneur

Answer 15

• money
• doing something you enjoy
• profitable
• success
• meet family needs
• avoid job disatifaction

Question 16

how do you calculate revenue

Answer 16

number of customers
X
selling price

Question 17

shareholder

Answer 17

a shareholder is a stakeholder, but not all stakeholders are shareholders

Question 18

commercial services

Answer 18

• aimed at businesses
• some include marketing, market research

Question 19

how do you calculate BEP

Answer 19

fixed costs
/
contribution

Question 20

factors impacting site

Answer 20

• ease of access to the site
  -footfall
  -costs
• proximity to competition
• personal reasons

Question 21

how do you calculate profit/ loss

Answer 21

revenue - total costs

Question 22

external growth

Answer 22

involves increasing the size of a business by buying other businesses

Question 23

margin of safety

Answer 23

the difference between your breakeven point and actual sales that have been made

Question 24

internal growth

Answer 24

this is where a business grows by developing the size of the business, by its sales, revenue

Question 25

how do you calculate variable costs

Answer 25

number of customers X variable cost per person

Question 26

diversification

Answer 26

allows business to enter a different market, this enable the business to spread its risks

Question 27

outsourcing

Answer 27

outsourcing occurs when a business pays another firm to produce its products. this allows the business to increase its capacity quickly with minimal investment

Question 28

how do you calculate contribution

Answer 28

selling price - variable cost

Question 29

what are the 4 factors of production

Answer 29

land, labour , capital, entrepreneur

Question 30

location

Answer 30

businesses location refers to the geological area of location such as a certain country

Question 31

limitations of breakeven

Answer 31

all just a prediction

Question 32

advantages of breakeven

Answer 32

- can see how many items you need to become profitable - see if business is viable

Question 33

site

Answer 33

finding a site for a business, considers a physical location with more specific factors

Question 34

STAKEHOLDERS

Answer 34

a stakeholder is a person or organisation that affect or are affected by an organisation

Question 35

open new stores + ecommerce

Answer 35

- sometimes a business will open a new store under the same name in a different location - sometimes to expand a business they open an online store

Question 36

what is a franchisor

Answer 36

is a business with an established brand

Question 37

what is a franchisee

Answer 37

a franchisee is a person or business that pays a franchisor to do business under their name/ brand

Question 38

whats franchising

Answer 38

a franchise is a way of doing business that involves a franchisee and franchisor

Question 39

how do you calculate total cost

Answer 39

fixed costs + variable costs

Question 40

factors that affect location

Answer 40

- infrastructure - the market - raw materials - labour - government assistance - historical

Question 41

takeover

Answer 41

when one business gains control of another

Question 42

characteristics of an entrepreneur

Answer 42

- creative -risk taking - determined - confident

Question 43

merger

Answer 43

when two or more businesses join together to form a business

Question 44

what are the risks of being an entrepreneur

Answer 44

- loss of savings - demand - business fail - unpredictable - financial

Question 45

cashflow

Answer 45

showing how your profit and loss may be

Question 46

skills

Answer 46

shows banks what skills you have for your business

Question 47

financial plan

Answer 47

showing bank what your spending money on

Question 48

business plan

Answer 48

Helps in decision-making by showing the aims and objectives of a business and the strategies and requirements needed to achieve these. It also provides information to banks

Question 49

why make a business plan?

Answer 49

* It will be needed by banks before lending money * It shows how the business will be run * It shows the business has been researched and thought through * It shows opportunities and problems

Question 50

what is in a business plan?

Answer 50

- aims of business -cashflow forecast -owners CV -type of ownership -marketing -location -financial information

Question 51

needs

Answer 51

: Items that you have to have in order to survive.

Question 52

wants

Answer 52

Items that you would like to have but are not necessary to your survival. They enhance your lifestyle

Question 53

SMART

Answer 53

- specific - measurable - achievable - relevant - timed

Question 54

aims + objectives

Answer 54

profit maximization survival provide a service market share be ethical