Objectives And Strategy- Risk And Undertainty Flashcards
What is contingency planning?
Planning for unexpected events, especially those that pose a severe threat to the success/survival of the business
How do you prevent a hostile takeover?
Owning 51% of shares of a business
How should prevent gearing?
Maintaining good cash flow
How do you prevent only having one major supplier or customer,
Securing more that 1
What are the 6 steps in the flow chart of creating a contingency plan?
Identify potential risk Brainstorm solutions Select appropriate solution Formalise Practise Adjust
What are 3 advantages of contingency planning
Reduce risks
People won’t panic
Showing potential investors they are capable
What are 3 disadvantages of contingency planning
Opportunity cost
Waste of time
Difficult to plan for some crisis
Name 5 types of risk
Recession Hostile takeover Strikes Contamination Failure of new product
What are 4 different ways to deal with risk
Share/deflect risk
Make contingency plans
Treat it as opportunity
Adapt business to deal with it
What is continuous data?
Data that can be spilt up e.g. Shoe size
What is discrete data?
Data that cannot be spilt up e.g CDs you own
What do histogram show?
Continuous data
How do you work out frequency?
Class width X frequency density
What are 2 advantages of histograms?
Good for large sets of data because they can be grouped within intervals
Good visual way to represent information
What are 2 disadvantages of histograms?
Cannot determine actual figures
More difficult to compare 2 sets of data
