Business Fundamentals Unit 24/25 Flashcards
Year 9 Summer 2/Year 10 Autumn 1
What is the sales price?
The price a product sells for.
What is the quantity?
The number of products sold.
What is revenue?
The price of the product multiplied by the number of products sold.
What is the primary sector?
This means the raw materials are extracted, e.g. fishing, farming, forestry etc.
What is the secondary sector?
This means the manufacturing, where raw materials are converted into products.
What is the tertiary sector?
This means the transport and sales, where the products are transported and sold to customers.
What are variable costs?
Costs that increase when you make more products, e.g. materials, packaging, wages etc.
What are fixed costs?
Costs you have to pay even if you do not make/sell anything, e.g. premises, salaries, insurance.
How is the total cost calculated?
When the variable costs and the fixed costs are added together.
What is the design mix?
The three elements considered when developing a product: function, aesthetics and cost.
What is function?
The purpose of the product.
What is aesthetics?
The look and feel of the product.
What is cost?
The cost/money spent making the product.
What is revenue?
The money from customers.
What are costs?
The money spent making the products.
What is profit?
When the revenue is bigger than the costs.
What is a loss?
When the costs are bigger than the revenue.
What is the Marketing Mix?
A tool that outlines the key elements a business should consider when developing its marketing strategy. The 4Ps stand for Product, Price, Promotion, and Place.
What is the Product?
The business needs to know everything about the product they are going to sell, e.g. features, colours, purpose.
What is the Price?
The business must consider the impact of the price on the consumer, e.g. good value for money in comparison with competitors - “Perceived product value to the customer”.
What is Promotion?
The business must ensure the product is received well by the target market, e.g. tv, social media - “Perceived by the customer”.
What is Place?
The business must consider the shops and places that the product can be sold.
What is the Breakeven Point?
When the money spent by the business is the same as the money received from customers.
What is the Sales Price?
The price a product sells for.
What are Variable Costs?
Costs that go up the more products you make, e.g. wages, materials, packaging.
What are Fixed Costs?
Costs you have to pay even if you do not sell anything, e.g. rent, rates, salaries.
What is capital?
Money and physical resources such as equipment, machinery and buildings.
What is enterprise?
The ideas, innovation and resilience.
What is land?
Physical and extractable natural resources.
What is labour?
The people, or human resources needed to run a business.
What is cash?
The money that flows in and out of the bank account.
What is the Opening Balance?
The money in the bank account at the beginning of the month.
What is the Cash Inflow?
The money that comes into the bank.
What is the Cash Outflow?
The money that flows out of the bank.
How is Net Cash Flow calculated?
The money flowing into the bank - the money flowing out of the bank.
What is the Closing Balance?
The money in the bank account at the end of the month.
What is an overdraft?
An overdraft is when a bank allows a business to withdraw more money than is in its bank account. The bank charges a fee for this, plus interest payments on the outstanding amount.
What is Trade Credit?
A supplier may extend the amount of time to pay an invoice or bill.
What is a loan?
Loans are the borrowing of money from a bank or other financial institution.
What is crowdfunding?
Crowdfunding can be a fast way to raise finance. Crowdfunding requires a lot of work to build up interest.
What is a loan?
The money borrowed from the bank.
What is the Borrowed amount?
The amount of money you borrowed from the bank.
What is the Repayable amount?
The extra money you pay back to the bank.
What is the Interest paid?
The amount of extra money you paid.
What is the Interest rate?
The rate of interest paid on the borrowed amount.
What is a Stakeholder?
A group or an individual who has an interest in what the business does.
What is an Internal stakeholder?
Inside the business, e.g. owner, manager, employee.
What is an External stakeholder?
Outside the business, e.g. supplier, customer, local community, competitors.
What is Conflict?
When two or more stakeholders have a disagreement about how the business is being run.
What is Cash?
The money that flows in and out of the business bank account.
What is a Cash surplus?
More cash comes into the business bank account than goes out.
What is a Cash deficit?
Less cash comes into the business bank account than goes out.
What is Solvency?
The ability to pay bills - a regular cash surplus will lead to a solvent business.
What is Insolvency?
The inability to pay bills - a regular cash deficit will lead to an insolvent business at risk of failure.
What is an aim?
States the overall purpose for the business, the long-term goal.
What is a mission statement?
General description of the overall aims of the business; can be just one sentence!
What are the objectives?
Specific, measurable targets to help meet the aims of the business.
