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Business Studies Flashcards

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1
Q

What is a need ?

A

A need refers to something essential in everyday life like water or shelter .

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2
Q

What is a want ?

A

A want refers to something that people desire or with for but is not essential in everyday life like donuts.

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3
Q

What is a business?

A

A business is an organistation which trades to make money these come in all shapes and sizes.

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4
Q

What are two examples of a business ?

A

A big supermarker like Asda.
An electrician.

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5
Q

What is a product ?

A

A product is anything that is capable of satisfying customer needs .

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6
Q

What does tangible ?

A

Tangible means that you can touch it .

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7
Q

What is an example of a tangible product ?

A

A car

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8
Q

What is a service ?

A

A service is an act that a business person carries out for you in exchange for money .

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9
Q

What is an example of a service ?

A

The dentist

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10
Q

What are the 4 things neded to produce goods and services ?

A

Land , Labour , capital and enterprise .

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11
Q

What is land ?

A

Land is somewhere to produce the goods like a farm .

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12
Q

What is labour ?

A

People who work in the business

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13
Q

What is capital ?

A

Money to get the business started.

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14
Q

What is an enterprise ?

A

An enterprise is the drive or motivation from the owners to start a business .

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15
Q

What is an opportunity cost ?

A

The cost of not selecting an alternative when making a decision .

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16
Q

What are the 5 reasons for starting a business ?

A

. To produce goods
. To supply a service
. To disribute products
. To fulfil a business opportunity .
. To provide a good a service to benefit others .

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17
Q

What is the primary sector ?

A

The primary sector extracts raw materials from the planet .

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18
Q

What is the secondary sector ?

A

Goods are manafactured from raw materials into finished goods.

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19
Q

What is the tertiary sector ?

A

The tertiary sector is the shops that sell the prdocuts or lorries that transport the shops.

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20
Q

What is an entrepeneur

A

An entrepeneur can be defined as: A person who starts a business and takes on financial risk in the hope of making a profit

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21
Q

What qualities does an entrepeneur need to have ?

A

They have to be hardworking , initiative , organised , risk taker.

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22
Q

What are some entrepeneur objectives ?

A

To be your own boss , flexible hours , to pursue an interest , to earn money , to identify a gap in the market.

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23
Q

What are the changes that have happened to a business to adapt ?

A

Changes in Technology
Changes in the economic situation
Changes in legislation
Changes in enviromental expectations

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24
Q

What is inflation ?

A

The rate of increase in prices for goods and services

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25
Q

What are interest rates ?

A

Interests are the cost of borrowing or the reward of saving

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26
Q

What are exchange rates ?

A

Exchange ratss are the cost of one currency expressed in terms of another.

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27
Q

What is a sole trader ?

A

A sole trader is a business which has only one owner .

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28
Q

Do sole traders have unlimited liability ?

A

Yes

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29
Q

What is one example of a sole trader ?

A

Plumber.

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30
Q

What are two advantages of being a sole trader ?

A

Easy to set up
They are their own boss

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31
Q

What are the disadvatnages of being a sole trader ?

A

Unlimited liability and its difficult to raise money

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32
Q

What is unlimited liability ?

A

Unlimited liability means that the owner or the owners are responsible for their debts of the business.

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33
Q

What is a partnership ?

A

A partnership is a decision made when normally two people work together as the owners of the business.

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34
Q

What is one example of a partnership ?

A

Doctors

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35
Q

What are two advantages of a partnership ?

A

Easy to set up and the capital needed is small

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36
Q

What are two disadvantages of a partnership ?

A

Partnerships have unlimited liability
Trust and reliability can be an issue

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37
Q

What is limited liability ?

A

Limited liability means that the business owner or owners are only responsible for the business debts . This means that the owners have protection of their personal funds to pay business debts .

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38
Q

What is a private limited company ( LTD )

A

A privated limited company is a business that has limited liability . The shares in this business cannot be bought by the public but only by the friends and families .

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39
Q

What are two advantages of an LTD ?

A

. Protection of limited liability for investors who then don’t lose their own funds or assets .
. Easy to raise capital

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40
Q

What are two disadvantages of an LTd ?

A

. Business has to issue more information about itsekf which can be expensive to produce .
. They have to make annual accounts to the public and for competitiors to see .

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41
Q

What is a public limited company ?

A

A public limited company is a business that can sell shares to anyone from the public. It also has limited liability

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42
Q

What are the advantages of a PLC ?

A

. Protection of limited liability
. Easy to raise capital

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43
Q

What are two disadvantages of a PLC ?

A

. Expensive to produce annual accounts every year
. Expensive process to become a plc

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44
Q

What is a share ?

A

A percentage or an amount of a company

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45
Q

What is a stock market ?

A

A market where business shares are traded

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46
Q

What is a not for profit organisation ?

A

An organisation that does not seek profit but other things instead like a social cause .

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47
Q

What is one example of a non for profit organisation ?

A

Cafod

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48
Q

What does surplus revenue mean ?

A

You make extra than you thought you’d make .

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49
Q

What are the objectives of a business ?

A

Survival , Growth , Profit maximisation , customer satisfaction , social and ethical objectives .

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50
Q

What are aims in a business ?

A

Aims are the strategic goals of a business; for example to grow

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51
Q

What are objectives ?

A

Objectives are more soecific steps in a business

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52
Q

What are two roles of objectives in a business ?

A
  1. They help keep the owner and employees all working towards common goals
  2. They help the onwner keep an eye on profitability , costs and profit margins
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53
Q

What are three reasons business don’t all have the same objectives ?

A

Business size , level of conpetition faced and type of business .

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54
Q

What is a survival in a business that is just starting ?

A

In the first year of trading , a start up business may aim to just survive . This means that it will have to just focus on keeping the business running and not taking too many risks

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55
Q

What is growth in a business ?

A

As business begin totrade and develop over time , they might start to change the objectives to help the business grow .

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56
Q

What is market share ?

A

This is the percentage of sales held by a business in a market .

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57
Q

What are social enterprises ?

A

Social enterprises are business trading for social or enviormental purposes .

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58
Q

What is shareholder value ?

A

This is where shareholders in a business earn a return from the investement which is greater than their required rate of return .

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59
Q

What is a stakeholder ?

A

A stakeholder is defined as anyone who has an interest in a business and is affected by the actions of the business .

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60
Q

What is the role of the owner ?

A

To start and run a business to make a profit

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61
Q

What are the objectives of owners ?

A

To make profit and to survive

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62
Q

What is the role of employees ?

A

To work in a business in return for wages

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63
Q

What are the objectives of employees ?

A

To have a job satisfaction, to have job security so they can pay their bills, to get promoted .

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64
Q

What are the customers role in a business ?

A

To buy goods or services from the business

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65
Q

What are the customers objectives in a business ?

A

To get a good choice of goods or services and to get good value for their money .

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66
Q

What is the role of the local community in a business ?

A

They might just by the businesses operations in their local area .

67
Q

What are the objectives of the local community ?

A

They want the business to provide jobs and they want the business to operate in an ethical way .

68
Q

What is the role of suppliers in a business ?

A

To provide the business with goods or services that they might need .

69
Q

What are the objectives of a supplier ?

A

They want to charge higher prices to make a profit and they want customer loyalty with repeat orders .

70
Q

How can stakeholders affect by the business activity ?

A
  • Employees can influence the success of an organisation by their productivity and efficiency l
  • Suppliers can decide whether to raise prices for orders .
  • Government can influence a firm by introducing new laws .
  • Customers can influence a business by deciding to continue to purchase goods and services from the organisation .
71
Q

What is one possible conflict between stakeholders that can involve employees ?

A

Employees want higher wages but owners and shareholders don’t want to pay higher wages, as this will raise costs and therefore impact profit.

72
Q

What is one possible conflict that can involve managers ?

A

Managers want big bonuses but owners and shareholders don’t want to pay them as this will inpact costs and lower profits .

73
Q

What is one possible conflict between stakeholders that can involve customers ?

A

Customers want low prices and high quality, but owners and shareholders want high profit and high prices .

74
Q

What is one possible conflict between stakeholders that can involve local communities ?

A

Local communites want lower pollution levels, but owners and shareholders want high profits and reducing pollution will affect that .

75
Q

What is one possible conflict between stakeholders that can involve suppliers ?

A

Suppliers want to get good prices for their goods and services, owners and shareholders want high profits and want to keep their costs low .

76
Q

What is the cost of premises ?

A

The rent you pay to own a shop .

77
Q

What is a government grant ?

A

A government grant is when the governent lends money to a business or people .

78
Q

Why can being close to the manafactures of your goods be good ?

A

Because it will will reduce costs for the business .

79
Q

Why is it important for a business to be close to the customer traffic ?

A

Its important because it is good for sales as more customers will be closer to your business .

80
Q

Why is it good for the business to locate close to conpetitors ?

A

Its good for a business to do this because they will be located in area which is well known for their products .

81
Q

Why is it important for a business to be close to its materials ?

A

The closer a business can be to the raw materials it needs for production, the lower the costs of production .

82
Q

What is a retail business ?

A

A retail business is a shop on a street for example

83
Q

What is a business plan ?

A

A document which sets out the future plans for a business .

84
Q

What are the four purposes of a business plan ?

A

To help set up a new business
To help the business raise finance
To help the business to set objectives
To outline how functions of the business will be organised .

85
Q

How will a business help an enterpeneur set up a new business ?

A

They will help them decide what resources they need to start their business .

86
Q

What does SMART stand for ?

A

Specific , measurable , agreed , realistic and timed .

87
Q

What are the main sections of a business plan ?

A

. Goals
. Pricing
. Knowing your market
. Customers
. Competitors
. Location
. Promotion
. Finance

88
Q

What do goals in a business plan include ?

A

Information on short term goals and long term goals

89
Q

What does pricing include in a business plan?

A

Pricing the product and costs

90
Q

What does knowing your market include in a business plan ?

A

What market you wish your business to be in , e,g catering .

91
Q

How are customers included in a business plan ?

A

Need to see which people are likely to buy your productd

92
Q

How are competitors included in a business plan ?

A

Need to show how the business is different in terms of price and your products .

93
Q

How does location fit into a business plan ?

A

You need to know where your location will be and what are the advantages of that location .

94
Q

What is one benefit of a business plan ?

A

A business plan will help the business owner define their business idea .

95
Q

What is one drawback of a business plan ?

A

Plans are only good if they are put into motion .

96
Q

What are fixed costs ?

A

Fixed costs are costs that do not vary with level of business output ( this is how much the business sells ) .

97
Q

What are variable costs ?

A

Variable costs are costs that do vary with the level of trade .

98
Q

What are total costs ?

A

Total costs is calculated when all your fixed and variable costs are added together .

99
Q

What is sales revenue ?

A

Money into your business through sales is called sales revenue .

100
Q

What is the formula for sales revenue ?

A

Price of goods x quantity you have sold .

101
Q

What are two types of profit ?

A

Gross profit
Net profit

102
Q

What is the equation for gross profit ?

A

Sales revenue minus varibale cost

103
Q

What is the equation for Net profit ?

A

Sales revenue minus fixed costs and variable costs .

104
Q

What are two types of growth ?

A

Organic and inorganic growth .

105
Q

What is organic growth ?

A

This means that the business has grown from within . This means that it didn’t need takeovers or mergers .

106
Q

What are the four ways a business can organically grow ?

A

Franchising , outsourcing , opening new stores and expanding through e-commerce .

107
Q

What is franchise ?

A

When a business wants to sell their idea to other peole instead of spending money opening a whole new one .

108
Q

What is e-commerce ?

A

E-commerce is the use of a website or online shop to sell their products or their business ideas .

109
Q

What is outsourcing ?

A

This is when the business finds out they can’t do a specifc role in the business so they find people who can .

110
Q

What is one advantage of organic growth ?

A

A business that grows from within can retain their own company culture .

111
Q

What is one disadvantage of organic growth ?

A

A very high risk strategy, opening lots of stores or taking on new staff is very risky .

112
Q

What is inorganic growth ?

A

A business may decide to grow quicker and so it will decide to merge or takeover another business .

113
Q

What does merger mean ?

A

When two business combine together .

114
Q

What is a takeover ?

A

A takeover is when a business takes over another a business.

115
Q

What is one advantage of merging ?

A

Economies of scale

116
Q

What is one disadvantage of mergers ?

A

Possible communication problems .

117
Q

What is one advantage of a business takeover ?

A

Buying a competitor eliminates the threat of that competitor .

118
Q

What is one drawback of a takeover ?

A

This is a very expensive and risky way to grow a business .

119
Q

What is economies of scale ?

A

When the costs fall as the business increases the output .

120
Q

What is diseconomies of scale ?

A

As the level of output of a business increases, eventually the average costs increase, this is called diseconomies of scale .

121
Q

What are two methids of e-commerce ?

A

Online auctions and advertising .

122
Q

What is online advertising ?

A

Online advertising are ads for the business that target customers to buy their products online .

123
Q

What is an online auction ?

A

This is a virtual market place where customers can bid for products or services .

124
Q

What are two methods of digital communication ?

A

Mobile phone call and E-mail .

125
Q

What is one advantage of using mobile phones ?

A

Ideal when an employee wants to speak to a customer or client at length

126
Q

What is one disadvantage of mobile phone calls ?

A

Mobile phone calls are not always reliable , the reception must always be available if you’re talking to a customer .

127
Q

What does ethics mean ?

A

In a business ethics can be defined as knowing right from wrong .

128
Q

What are two ways a business call be more ethical ?

A
  1. Paying workers higher wages
  2. Improved working conditions
129
Q

What are two examples of when a business sometimes is not ethical ?

A

Poor Working conditions and child labour .

130
Q

What is one benefit of a business being ethical ?

A

They may be more popular with customers who might be interested in buying your products .

131
Q

What is one disadvantage of ethics ?

A

They may not be able to maximise profits.

132
Q

What is a trade off ?

A

A compromise between one thing and another . For example a compromise between making a profit and being ethical .

133
Q

What are two enviormental considerations in a business ?

A

Recycling and air pollution

134
Q

What is one benefit of a business trading with the enviroment in mind ?

A

It will meet the needs of customers who might want to become greener .

135
Q

What is one drawback of a business trading with the enviroment in mind ?

A

Greener products may mean more expensive products in mind .

136
Q

What are two ways a business can be more enviromentally friendly ?

A
  1. Using solar energy
  2. Producing goods with less packaging
137
Q

What does sustainability mean ?

A

The process of which a business will try to maintain ecological balance .

138
Q

What is sourcing ethically ?

A

When businesses seak to source products in a sustainable and responsible way .

139
Q

What is an economic climate ?

A

The general condition of the economy, the way that the resources and the production and consumption of goods in the Uk are managed .

140
Q

What are interest rates ?

A

Interest rates are the cost of borrowing money or the reward of saving money

141
Q

What is unemployment ?

A

The number of people willing to work but out of work and seeking work .

142
Q

What is disposable income ?

A

When a workee recieves their wages they will have to pay tax and national insurance . And what is left is their disposable income .

143
Q

What is a discretionary income ?

A

After a disposable income a worker will have to pay for bills , electric , food and gas . After this the money left over is called their discretionary income

144
Q

How does unemployment affect a business ?

A

It weakens consumer buying , people will have less money to spend if they are unemployed .

145
Q

How else does a unemployement effect a business ?

A

Many unemployed people decide to become entrepeneurs which means that business lose out on people to employ .

146
Q

What are the three types of goods ?

A

Inferior goods
Normal goods
Luxury goods

147
Q

When are luxury products bought ?

A

When consumer incomes rise they choose to buy better products .

148
Q

When are inferior products bought ?

A

They are bought when consumer incomes fall and they buy cheaper products .

149
Q

What is globalisation in business ?

A

The process by which the world is becoming increasingly interconnected as a result of international growth .

150
Q

What is a multinational MNC ?

A

A multinational is a business which trades in more than one country .

151
Q

What are two benefits for uk business of globalisation ?

A

Wider markets and economies of scale

152
Q

What does a wider market mean ?

A

Trading on a global level

153
Q

What is labour migration ?

A

People from different countries coming to work here to carry out jobs like the NHS and manafacturing .

154
Q

What is labour migration useful ?

A

Its useful because it allows businesses to extract talented employees worldwide .

155
Q

What is specialisation ?

A

Specilisation is when some economies start to specialisd at what they are good at .

156
Q

What is the multiplier effect ?

A

As MNC’s move to the uk for manafacturing , they create jobs for uk workers .

157
Q

What are two drawbacks to globalisation ?

A

Foreign competition and loss of uk staff

158
Q

What is an export ?

A

This is a product that the countries sell to overseas markets .

159
Q

What is one thing the uk export ?

A

Machinery

160
Q

What is international trade ?

A

This is the exchange of goods and services between different countries .

161
Q

What are two ways a country can compete internationally ?

A

Better designs for products and higher quality products for lower prices .

162
Q

What is an import ?

A

An import is a product made overseas and brought to your own country

163
Q

What is an exchange rate ?

A

The exchange rate is the the price of one currency in exchange for another .

GCSE 🏋🏾‍♂️ (13 decks)

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