Business Exam Questions Flashcards

1
Q

Similarities between for-profit and not-for-profit organisation

A

The need to cover expenses
Both have operating expenses (eg. Rent)
Expanding the org in an ethical and socially responsible way
To help the local or broader community

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2
Q

Differences between for profit and not for profit organisation

A

Primary objective:
For an FP org the primary objective is to increase its sales revenue to enable it to provide a return (profit). NFP orgs aim to achieve its social mission (eg. Help disadvantaged people in community.
FP orgs return surplus funds to owners and shareholders and NFP don’t, money goes back to biz
FP orgs pay workers, NFP orgs have volunteers

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3
Q

Difference between a small and medium biz

A

Small biz has fewer than 20 employees.. Medium hahahahaha s 20-199
Small biz usually has sole trader or partnership, medium has partnership or private company.

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4
Q

A financial objective for a discount store that provides low cost household goods and describe strategy

A

Increase the volume of sales

Could achieve by lowering prices, increase number of specials, encourage buying in bulk

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5
Q

A social objective for a discount store that provides low cost household goods and describe strategy

A

Ecological sustainability

Provide bags and home brand product packaging that is biodegradable

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6
Q

Why is it important for a FP biz to have social objectives

A

Because if a biz is ethical, it influences purchase

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7
Q

Positive contributions that a small business can make to the economy

A

Provide workers who can use the money to provide goods and services, helping out the economy

Economic growth, by producing goods and services, small biz’s contribute in gross domestic product in the economy

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8
Q

Difference between the internal environment and external environment of a business

A

Internal, includes factors such as owners, management, employees and cooperate culture. Some degree of control

External, includes Eco, environmental, customers, competitors and suppliers. No control

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9
Q

Distinguish between entrepreneurship and innovation

A

Entrepreneurship is the ability and willingness to start, operate and assume the risk of a business venture in hope of making a profit

Innovation refers to creating a new product, service, or process, or significant,y improving an existing one.

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10
Q

List the amount of employees for the three kinds of businesses

A

Small, less than 20
Medium, 20-199
Large, 200+

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11
Q

Type of ownership for the three kinds of businesses

A

Small, partnership or sole trader
Medium, partnership, private company
Large, public company

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12
Q

Market share for the three kinds of business

A

Small, small usually in the local area
Medium, medium dominant in the geographic region
Large, large multinational

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13
Q

Macro environment consists of…

Int real or external

A

Political pressure, economic pressure, legal issues, technology, ethics and social responsibility EXTERNAL

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14
Q

Operating environment consists of…

Internal or external

A

Competitors, finance, companies, employees , unions, suppliers, customers EXTERNAL

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15
Q

Internal environment consists of…

Internal or external

A

Organisational structure, corporate culture, management styles, management skills, policies, management roles and social responsibility

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16
Q

List of performance indicators

A
Percentage of the market share
Net profit figures
The rate of productivity growth
Number of sales
Staff/customer satisfaction surveys 
Staff turnover
Wastage level
Customer complains number 
Sick days number
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17
Q

Financial indicators characteristic

A

Quantitative data

18
Q

Non financial indicator characteristic

A

Qualitative data

19
Q

Sole trader business Char adv and disadv

A

One person who owns and runs the business
Easy to establish, freedom
Unlimited liability

20
Q

Partnership char, adv and disadv

A

Has a minimum of 1-20 partners
Limited liability
Potential disputes

21
Q

Advantages of purchasing an established business

A

Existing Goodwill passed over
Instant income from existing customers
Everything is already set up

22
Q

Disadvantages of purchasing an established business

A

May be difficult to change existing image and policies of the original business
Employees may resent change of owner
Previous success may be because of previous owners

23
Q

Advantages of setting up a new business

A

Freedom to make decisions
No goodwill that the owner has to pay
Possible to begin on a smaller scale

24
Q

Disadvantage of setting up a new business

A

High risk and a measure of uncertainty without a previous reputation
May be difficult to secure finance
Time needed to develop a customer base
Start up period is slow

25
Advantages of buying a franchise
Already established Immediate benefit from goodwill Franchiser often provides training Franchise can succeed despite having limited experience
26
Disadvantage of buying a franchise
Franchisor controls the operations, with little scope of franchise individuality Profits shared by franchisor Additional service fees
27
Things to consider with location of a business
Owners personal factors eg.close to home Competition, demographics, socioecomics Visibility Accessibility to target market, transport and customers Cost of premises Proximity to customers, suppliers, companies and complimentary business's
28
Benefits of developing a business plan
Helps the viability of the business Identifies strengths and weaknesses Indicates owners ability and level of commitment Assists the business to be proactive rather than reactive
29
What are the 4 p's of the marketing mix
Product Price Promotion Place
30
Objectives can be
Strategic Tactical Operational
31
Strategic goals
Long term goal 3-5 years Buy second store
32
Tactical goals
Medium term goal 1-2 years Increase market share by 2%
33
Operational goals
Short term goals Up to 12 months Increase profit
34
Vision statement dot points
Aspiration Future Just out of reach Shows that the business is heading somewhere
35
Mission statement dot points
Who we are What we do Where are you going
36
Two legislations that protect workers
Occupational health and safety act 2004: ensures the safety of the employees Equal opportunity act of 1995: makes discrimination illegal in work places
37
The three phases of recruitment
Establishment phase: planning, recruitment and selection Maintenance phase: induction, training and development and performance management Termination phase
38
Ways of termination
Voluntary Resignation – employee resigns Retirement – employee withdraws from workforce Involuntary Retrenched – job no longer exists Dismissal – fired Be wary of unfair and unlawful termination
39
The 10 national employment standards
``` Hours of work: full time 35-38 Flexible work for parents Annual leave Personal, careers and compassionate leave Community service leave Public holidays Notice of termination and redundancy Information in the work place Long service leave ```
40
Selection of an employee is
The process of gathering information and subsequently choosing the most suitable applicant