bussiness

Question 1

aim

Answer 1

a general goal or ambition to be achieved

Question 2

objective

Answer 2

a specific target that will enable the aim to be achieved

Question 3

business objects ideally should be SMART

Answer 3

Specific
Measurable
Achievable
Realistic
Time-bound

Question 4

business risks

Answer 4

bussiness failure
finiancial loss
lack of security

Question 5

what might cause a business to fail?

Answer 5

drop in sale revenue
cash flow problems
unexpected costs
recession
problems with suppliers
competition

Question 6

risks that lead to financial

Answer 6

risk that a competitor might do better
risk that a product may fail
risk of having insufficent money

Question 7

lack of security

Answer 7

-being an entrepeneur and running a business may not be as secure as working for someone else
-wages, sick pay, pension etc may not be guaranteed
-personal saving may have to be invested in the business
-running a business can be very stressful and could effect an entrepreneurs health

Question 8

enterprise

Answer 8

another word for business

Question 9

goods

Answer 9

physical products that a customer is willing to pay for eg. bread

Question 10

services

Answer 10

non-physical products that a customer is willing to pay for

Question 11

3 purposes of a business

Answer 11

• to produce goods and services
  -to meet customer needs
  -to add value

Question 12

added value

Answer 12

adding value is the increase in a products value as a result of a business producing that product

Question 13

added value example

Answer 13

50=cost
95p=to make
49.05=added value

Question 14

the size of the business

Answer 14

small businesses will have different aimed objectives to large one

Question 15

the age of the business

Answer 15

new businesses will focus on survival more established business may focus on profit and market store

Question 16

the purpose of the business

Answer 16

privately owned businesss will have different aims and objectives to there owned by the govenment or not for profit organisations

Question 17

revenue

Answer 17

the amount of money a business recieves from sales

Question 18

revenue equations

Answer 18

selling price times quantity
R=Sp times Q

Question 19

total costs equation

Answer 19

fixed costs+variable costs

Question 20

fixed costs

Answer 20

costs that do not change, no matter how many products or services a business sells

Question 21

variable costs

Answer 21

costs that change depending on how many products or services a business sells

Question 22

profit

Answer 22

the difference between revenue and costs

Question 23

profit equation

Answer 23

revenue-total costs

Question 24

break even

Answer 24

total costs=total revenue

Question 25

break even equation

Answer 25

fixed costs divided by (selling price-variable)
Fc divided by (Sp-Vc)

Question 25

break even equation

Answer 25

fixed costs divided by (selling price-variable)
Fc divided by (Sp-Vc)

Question 26

credit terms

Answer 26

allow a business to purchase goods from a supplier and to pay for those goods at a later date

Question 27

cash flow

Answer 27

the flow of money into and out of a business

Question 28

forecast

Answer 28

prediction of estimate

Question 29

brackets

Answer 29

minus/negative eg. -100=(100)

Question 30

net cash flow

Answer 30

reciepts-payments

Question 31

income stream

Answer 31

revenue from different groups of customers or customer segments

Question 32

over draft

Answer 32

bank allows account holder to borrow money at short notice, but you have to pay back

Question 33

trade credit

Answer 33

supplier allows a period of time to pay for goods and services. items are brought from suppliers on a buy now pay later basis

Question 34

venture capital

Answer 34

a person or company who buys shares in a business that they hope will grow fast. in the long term they will sell the shares at a profit and often reinvest in other companys

Question 35

share capital

Answer 35

selling part-ownership in the businesses. the share holder receives part of the annual profit in the form of a divide.

Question 36

loan

Answer 36

money borrowed from the bank then repaid with interest over a set amount of time

Question 37

retained profit

Answer 37

a source of finance that does not need to be paid back, but is only available once the business has been trading successfully for a period of time

Question 38

crowd funding

Answer 38

provide valuable marketing benefits and media attention through the use of the internet