Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Business > Paper 1 > Flashcards

Paper 1 Flashcards

1
Q

What is a market?

A

A place where buyers and sellers come together to buy and sell goods/ services in return for money

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What is marketing?

A

The process of identifying, anticipating and satisfying customers needs and wants profitably

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What is a mass and niche market and there characteristics?

A

Mass : A large market where the most popular products are targeted

  • Sells goods to all consumers and markets them in the same way
  • Large number of customers
  • Businesses can exploit economies of scale

Niche - A smaller market within a larger market

  • Markets in a different way to mass marketing
  • Sells to small customer group
  • Easier to focus on the needs of the customers
  • Can charge premium prices if competition is low
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What is the difference between risk and uncertainty?

A

Risk - When the potential outcomes from a decision are known

Uncertainty - When none of the outcomes are known in advanced

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

How does competition impact customers?

A

Customers generally benefit from competition. They may have a wider range of products to choose from.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

How does competition impact Businesses?

A
  • Provide lower prices
  • Provide better marketing
  • Businesses start to listen to customers
  • Forces the business to produce higher quality goods/ services
  • A business may becomes less wasteful
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What are the different types of markets?

A

Consumer Goods Market - Eg food, clothes, magazines
Market for services - Eg services for individuals
The housing market - Eg buying and selling property
Commodity Markets - Eg where raw materials are traded (oil, copper, coffee)
Financial Markets - Eg where currencies and financial products are traded (stock market)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What should a business do to adapt in a (dynamic) market?

A
  • Be flexible in the the way they operate
  • Carry out market research
  • Invest in new product development
  • Make continuous improvements
  • Develop a niche
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

What is a dynamic market?

A

Markets that experience rapid or continuous changes

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

What is the formula for market share?

A

(sales of a business / Total sales in the market) * 100

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What is market research?

A

The process of gathering, presenting and analysing information about the market and consumption of goods and services

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What is primary and secondary research and the advantages and disadvantages?

A

Primary - Research collected first hand
+Up to date and reliable
+Better if you want to collect qualitative data

  • Time consuming
  • Difficult to conduct a large sample size

Secondary - Research that already exists
+Fast
+Often better if you want to collect quantitative data

  • Can be expensive
  • Not always up to date or tailored to the business
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What is product orientated and the advantages and disadvantages?

A

When the product is the businesses main priority. They develop products based on what they’re good and and not what the customers want.

+Allows the business to focus on the products quality
+Economies of scales can develop more easily

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What is market orientation and the advantages and disadvantages?

A

When the customer is the businesses main priority. They develop products based on what customers want.

+Increased customer satisfaction and loyalty
+Increased sales revenue

  • Lack of innovation as the business would be focused on reacting to market trends
  • Customers desires can change rapidly
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What is a brand?

A

Characteristics that allows consumers to identify the goods and services of a business

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What is a brand used for?

A
  • Differentiate their product
  • Create Customer Loyalty
  • Develop an image
  • Help with product recognition
  • Charge premium prices
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

What is online retailing and the advantages and disadvantages for both businesses and customers?

A

Having businesses transactions online through buying and selling goods/services

Businesses
\+Lower overheads
\+Reach a wider market
-Website crashes
-Highly competitive
-Less trust from consumers 
Customers
\+Fast/ convenient
\+Often cheaper
-Cant test the product before buying
-Shipping times
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

In what ways do markets change?

A

Size of market-
Nature of markets- Some markets are constantly changing
New Markets- advancements in technology can lead to new markets

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

What is primary and secondary research used for?

A
  • Identify and anticipate customers needs and wants
  • Quantify likely demand
  • Gain insight into customer behaviour
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

What is market segmentation?

A

Dividing your target market into similar groups

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

What are the limitations of market research?

A
  • Can be costly
  • Time consuming
  • Human behaviour can be unpredictable
  • Questions/ interviewer may have misleading questions
  • The sample size may not be an accurate representation of the whole population
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

What is market positioning?

A

Factors a business may consider when positioning a product in market maps

  • Attributes of the product
  • The Origin of the product
  • The reputation of the business (The classification of the product)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Name the competitive advantages a business can have

A 
Product design - 
Product quality -
Promotion - 
Customer service - 
Delivery times - 
Economies of scale - 
Flexibility - 
Ethical stance - 
Focusing on a particular market segment-
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

What is the purpose of product differentiation?

A

To gain a competitive edge over their competitors. In competitive markets firms will try to make their product unique

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

What is the 5 reasons for product differentiation?

A 
Flexible pricing-
Recognition - 
Extend product range - 
Brand development - 
Overcome competition -
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

What is market size (how is it estimated) and market share?

A

Market size can be estimated by either the market value (total amount spent) or volume (physical products sold)

Market Share - the proportion of a particular market held by a business

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

What are the reasons why a market may grow?

A

Economic Growth - Global living standards tend to rise overtime
Innovation - Innovation can grow a market
Social Changes -
Changes in legislation - Laws can affect markets
Demographic Changes -

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

What is adding value?

A

Extra features that may be offered by the business

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

What is the purpose of product differentiation?

A
  • Have flexible pricing
  • Recognition
  • Out compete competitors
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

What are the advantages of using social media for market research?

A
  • Can reach millions of people around the world
  • Allows specific groups of people to be targeted
  • Free or relatively low cost
  • Data can be collected fast
  • Takes little IT skills
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

How is ICT used to support market research?

A

Company website - Create online service
Social Networking -
Database - Storing users info

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

What is demand?

A

What customers are able and willing to buy at a given price

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

What is supply?

A

What firms are willing to produce at a given time

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
34
Q

What are the 7 factors that lead to a change in demand?

A

Substitutes - Eg buying Pepsi over coca cola
Complementary - Eg Buying milk with cereal
Consumer income - Inferior / normal goods
Preferences - Changes in consumer tastes
Advertising & Branding -
Demographic -
External stocks -
Seasonality - Eg garden furniture demand rises during spring

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
35
Q

What are the 6 factors that lead to a change in supply?

A

Cost of production - Eg wages, maintenance, raw materials, energy, rent
Introduction of new technology - help lower costs
Indirect taxes - Eg VAT
Government subsidies - Money given to a firm from the gov
External stocks - Factors beyond the control of the business eg weather
Price of related goods - The price of the good could encouraged supply

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
36
Q

What are inferior and normal goods with examples?

A

Normal goods - Increased income leading to an increase in demand
Eg cars, clothing , luxury goods

Inferior goods - Increase in income leading to an decrease in demand
Eg public transport, Tesco deals

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
37
Q

What is equilibrium price?

A

When supply and demand are equal

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
38
Q

What are firms likely going to do when the market price increases or decreases?

A

Increase - Firms will extend supply to the market

Decrease - Firms will contract their supply of a product

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
39
Q

Which direction does a supply and demand cure face?

A

Demand slopes down and supply slopes up

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
40
Q

What is the design mix and the three elements?

A

Three key elements that help a business find a gap in the market.

Aesthetics, Function, Cost

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
41
Q

What are the ways to build a brand?

A
  • USP - helps be unique
  • Advertising - spreads awareness
  • Sponsorship
  • Use social media
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
42
Q

What is distribution and the aim of it?

A

Evolves where consumers are able to purchase products from.

Aim: To make the products as convenient as possible for consumers to buy

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
43
Q

What are distribution channels?

A

The stages the products have to go through to get from the producer to the consumers

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
44
Q

What are intermediary’s?

A

A link between the producer and consumer

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
45
Q

What are the 5 types of an intermediary?

A
  • Retailers
  • Wholesaling
  • Agent/Brokers
  • Dealers
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
46
Q

What is multi channel distribution?

A

When a business uses more than one distribution channel

Eg you can buy apples products many different ways(pc worlds, O2 ect)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
47
Q

What is direct selling?

A

When a producer markets their products directly to consumers

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
48
Q

What are the 4 main factors to consider when choosing the appropriate distribution channel?

A
  • The nature of the product (Some products may be inappropriate)
  • Cost
  • The Market (Mass markets typically use intermediaries)
  • Control (don’t want to damage their image)
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
49
Q

What is online distribution?

A

Also known as e-commerce involves the use of electronic systems to sell goods and services

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
50
Q

What is the two types of online distribution?

A

Business to consumer (B2C)

Business to business (B2B)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
51
Q

What benefits do consumers have because of online distribution?

A
  • Cheaper
  • Can shop 24/7
  • Large amount of choice
  • Can shop from anywhere
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
52
Q

What benefits do businesses have because of online distribution?

A
  • Lower start up costs
  • Lower processing costs
  • Less paper is needed to document
  • Can offer global shipping
  • Business can locate anywhere
53
Q

What changes in the design mix that reflect social trends and what is ethical sourcing?

A
  • Design for waste minimisation
  • Design for reuse
  • Design for recycling

Ethical sourcing - Only using materials, services ect from suppliers that respect the environment, treat workers well and provide a safe working environment

54
Q

What is an entrepreneur?

A

People who have a business idea and want ti make money working for themselves

55
Q

What is the roles of entrepreneurs?

A

Decision making
Innovating
Risk taking
Organising

56
Q

What is an intrapreneur?

A

Employees who use entrepreneurial skills to find and develop ideas that’ll have financial benefits for the business

57
Q

What are the advantages of the intrapreneurs?

A

Increase innovation in the business

Awards can be won if unique products are made - Improves business image/ reputation

58
Q

What are the financial and non financial reasons of people starting a business?

A

Financial

  • Profit maximisation
  • Profit satisficing (making enough to satisfy the needs of an business owner)

Non-Financial

  • Ethical stance
  • Social entrepreneurship (charity)
  • Independence
  • Home working
59
Q

What are entrepreneur characteristics?

A
  • Self confidence
  • Self determination
  • Perseverance
  • Commitment
  • Initiative
  • Judgment
  • Being a self starter
60
Q

What are the required skills of an entrepreneur?

A
  • Communication
  • Financial management
  • Organising
  • Decision making
  • Negotiating
  • IT skilss
61
Q

What is a sole trader and the advantages and disadvantages?

A

When a business is owned and run by one person

+Owner keeps all profits
+Owner has complete control

  • Unlimited liability
  • May struggle to raise finance as investors many think they’re too risky
62
Q

What is a partnership form of business and the advantages and disadvantages?

A

A business that has more than one owner

+Can raise more capital
+Shared responsibility

  • Unlimited liability (They can become a limited partnership)
  • Shared profits
63
Q

What is a private limited company (LTD) and the advantages and disadvantages?

A

A business owned by shareholders protected by limited liability

\+Limited liability
\+Control over who buys shares
\+Perceived as more reputable
\+Raising capital
\+ Financial documents don’t have to be published
  • Shared profits
  • Shares can only be traded privately
  • costly to start up
64
Q

What is a public limited company (PLC) and the advantages and disadvantages?

A

A business owned by public shareholders on the stock market who are protected by limited liability

+Raise large amounts of capital
+Has greater media exposure
+Business isn’t reliant on one person ie if someone dies

  • Volatile share prices
  • Directors are accountable to thousands of shareholders
  • PLCs news can spread fast (negative or positive)
65
Q

What is a franchisee and the advantages and disadvantages?

A

A business that is allowed to use another businesses identity

+Lower risk as they are using someone else’s idea
+Are supported from the franchisor
+Start up costs are predictable
+Can benefit from the franchisors marketing

  • Have to pay royalty (Pay the franchisor their share)
  • Have to sign contacts which may reduce their independence
  • Can have high start up costs
66
Q

What is a franchisor and the advantages and disadvantages?

A

A company that owns the franchise and allows other business to use there identity

+Fast growth
+Less expensive as the franchisee takes some of the financial risk

  • Less profits as its shared with the franchisee
  • Franchisee may damage the reputation
  • Cost to support the franchisee may be high
67
Q

What are social enterprises?

A

Businesses that trade with the aim of improving human and environmental well being. (Just think of a charity)

68
Q

What is a lifestyle business?

A

A individual who aims to make enough money to sustain a particular lifestyle

-Small

69
Q

What is the stock market floatation?

A

When a business goes public and offers shares to the public for the first time

70
Q

What are the advantages and disadvantages of stock market floatation for a business?

A

+Can raise large amounts of capital as it is easy for the public to buy shares through a stockbroker or bank
+Shares don’t have to be repaid and no interest is applied
+The business can also gain recognition through this method

  • Time consuming
  • Expensive
71
Q

What are the cost/ process associated with the stock market floatation?

A

Lawyers
Business must have a minimum of £50,000 share capital

(Basically a lot of documentation is required)

72
Q

What is an emerging market?

A

An economy with low to middle per person income

A nation of a nation whose economy mimics that of a developed nation but does not fully meets the requirements to be a classified as one

Tries to transition from a closed market to an open market

73
Q

What are the advantages of merging markets?

A
  • Investors like merging markets
  • Better potential for returns
  • First mover advantage
  • They hope to invest early so that they benefit from rapid growth
  • Related to increasing incomes and an expanding middle class
74
Q

What are the 2 implications of economic growth for individuals and businesses?

A

Trade opportunities for businesses - consumption may be growing and is likely that consumers have more disposable income.

Employment patterns - unemployment rates, labour cost and productivity are good indicators for businesses. High unemployment rates in a country may not be worth exporting products to, however, they may be good for factory work.

75
Q

What is Trade Opportunities for businesses?

A

Consumption may be growing and is likely that consumers have more disposable income.

76
Q

What are the indicators of growth?

A

Gross Domestic per person (GDP) - A measure of economic activity. Can be hard to compare against other nations with different currencies
Literacy - educated employees lead to better quality workforce and products and service
Health - indicates living standards of people and how much money they may have

77
Q

What is growth rate?

A

Is the rate at which a nations (GDP) grows from one year to another

78
Q

What does a literate labour force offer?

A

They can work in white collar jobs and professions
They will make better Human Resources - can do more complex jobs and increased efficiency
They are successful and earn more - contributes more to the national income

79
Q

What is the equation for Net export?

A

Exports - Imports

80
Q

What is imports with examples?

A

Binging good and services from another country to the home county

Eg Foods: apples

81
Q

What is exports with examples?

A

Selling goods and services from the home country to other countries

Eg tourism: London

82
Q

What is the advantages and disadvantages of imports?**

A

+fulfils the demand of goods and services that are lacking or not available in the home country
+

83
Q

What is the advantages and disadvantages of exports?**

A

+creates more foreign income from the selling of home country products and increases the global presence of home country products and services
+benefits the home country since it increases the foreign income to the home country

84
Q

Why do we need to export and import?

A
  • Countries have specific natural recourses and lack others
  • Countries need foreign currency in order to grow
  • Countries access wealth from customers in other countries
  • Firms can get cheaper costs by importing raw materials
  • Increases sales potential (first mover advantage)
85
Q

What is specialisation?

A

When a business or country concentrates on a product or task but produces them at a higher quality and cost

86
Q

What is the Foreign Direct Investment?

A

When an investment is made by a company or individual from one country to another

Eg a person buying a company in another country

87
Q

What is the advantages and disadvantages of Foreign Direct Investment?**

A

+Gain access to new markets
+Get access to resources
+Reduce the costs of production
+Tax benefits

88
Q

What is globalisation?

A

The growing integration of the worlds economies (Goods and services are being traded around the world)

89
Q

What is trading blocks?

A

A group of countries that have signed a regional trade agreement to reduce or eliminate tariffs, quotas and other protectionist barriers

90
Q

What are employment patterns for growing economies?

A

Unemployment rates tend to fall

91
Q

What are the 8 factors contributing to increased globalisation?

A

Reduction of international trade barriers -
Political Change -
Reduced Cost of Transport and Communication -
Increased Significance of global companies -
Increased Investment Flows -
Migration -
Growth of the Global Labour Force -
Structural Change -

92
Q

What are the advantages of trading blocs?

A
  • Opportunities to expand into new markets
  • Allows businesses to benefit from comparative advantage - cheaper and better quality products
  • Makes it easier to source labour if free movement is permitted
  • Aligns international legislation making markets more efficient
93
Q

What are the disadvantages of trading blocs for a business?

A
94
Q

What are the different types of trading agreements?

A

Customs Unions - Free trade between members but an agreed set of tariffs against non members

Common Markets - free trade and free movement of labour and capital

Preferential Trade Areas - Certain products from certain countries receive reduced tariff rates

Free Trade Areas - No trade barriers between countries

Single Markets - Free trade and common laws are adopted to harmonise standards and tax

Economic Unions -

95
Q

What is the definition of push factors?

A

Negative factors within the uk that push a uk business to look overseas

96
Q

What are 6 push factors?

A
  • Saturated domestic markets
  • Competition
  • Low growth opportunities
  • End of the product lifecycle at home
  • Need to diversify
  • Need to reduce risk
97
Q

What is the definition of pull factors?

A

Positive factors overseas that entice a uk business to look outside the uk

98
Q

What are the 5 pull factors?

A
  • Risk spreading
  • Opportunity to gain EoS by expanding overseas
  • Attraction to new overseas markets in emerging economies eg Brazil
  • Opportunity to exploit competitive advantages in new markets
  • Ways to expand the product lifecycle
99
Q

What is offshoring?

A

The moving of operations of a business to another country with lower costs

Eg Apple moving their manufacturing operations to china

100
Q

What are the potential risks associated with offshoring?

A
  • Language difficulties
  • The process may increase management costs
  • Reduce efficiency or quality
101
Q

What is outsourcing?

A

This is where a business function, such as payroll, is contracted out to a specialist external provider

102
Q

Why outsource?

A
  • Reduce costs
  • Specialise areas of the business ie focus on core areas
  • Comply with rules or regulations
103
Q

What are the 5 reasons for global mergers or joint ventures?

A

Spreading risk over different countries/regions -
Entering new markets/trade blocs -
Acquiring national/international brand names/patents -
Securing resources/supplies -
Maintaining/increasing global competitiveness -

104
Q

What is global competitiveness and how can it be done?

A

The ability of a business to perform better than its rivals across markets in different countries

Measures a business’s ability to compete both at home and abroad against foreign firms

Through

  • Cost competitiveness
  • Differentiation
105
Q

Why may a business off-shore?

A

A business could:

  • Reduced cost
  • Hire workers with particular skills
106
Q

How might a business use the product life cycle (Consider the Offshoring)?

A

If a product has reached its declined stage in one market it may be in the introduction stage in another therefore a business may move operations to another market (country) in order to reduce cost/expand market share etc

107
Q

What is the impact of changes in exchange rate on a business?

A

Cheaper import costs and more expensive exports if the pound became strong.

108
Q

What is economy of scale?

A

It’s benefits businesses gain as they grow

109
Q

What are the problems with Growth?

A

Overtrading - Running out of cash
Diseconomies of scale - Average costs rise as output rises
Internal Communications - hard to communicate between departments

110
Q

What are the two types of growth?

A

Internal/ organic growth and external/ inorganic growth.

111
Q

What are the types of external growth and what do they mean?

A

Mergers and takeovers.

Merger-when two businesses have agreed to unite as one new company
Takeover(friendly/hostile)-when one firm gains control over another by buying 51% of shares

112
Q

What is horizontal integration?

A

When two firms in the same market and stage of production merges together

113
Q

What is vertical integration and the two different types?

A

When two firms in different stages of development joins together.
Backwards ie apple taking over a manufacturer
Forward ie apple taking over a retailer

114
Q

What is conglomerate?

A

When a firm merges/ takes over an unrelated business

Ie Apple and Cadbury

115
Q

What are the problems with rapid growth?

A

Outgrows premises, potential shortage of cash, potential increase in staff turnover and decrease in motivation

116
Q

What is a merger?

A

When two businesses have agreed to unite into one new company

(PLC Only)

117
Q

What is a takeover and the two types?

A

When one firm gains control over another by buying 51% of shares

Hostile - Both businesses are happy

Volatile - Resistance

118
Q

What is the financial risk of external growth?

A

Original cost
Costs of changing into a new business
Redundancies of duplicate staff
Opportunity cost - what if it all goes wrong

119
Q

What is the financial reward of external growth?

A

increased revenue

Economies of scale

120
Q

What is economy of scale?

A

It’s benefits businesses gain as they grow

121
Q

What are the objectives of growth?

A

Economies of scale
increased market power - business can charge higher price/ demand lower costs from suppliers
Increased market share/ brand recognition & power -
Increased profitability - greater returns

122
Q

What are the problems with Growth?

A

Overtrading - Running out of cash
Diseconomies of scale - Average costs rise as output rises
Internal Communications - hard to communicate between departments

123
Q

Give examples of internal economies of scale

A
  • Purchasing and marketing economies, marketing becomes cheaper
  • Technical economies,
  • Specialisation and managerial economies, can afford higher skilled workers
  • Financial economies, Can raise finances easier
  • Risk bearing economies, reduced risk as they can carry out more intensive research
124
Q

Give examples of external economies of scale

A
  • Labour, if schools offer training courses that are aimed at the industry
  • Lower transport costs
  • Ancillary and commercial services,
  • Co-operation
  • Disintegration
125
Q

What are the 4 factors to consider when controlling MNCs?

A

Political Influence -
Legal Control -
Pressure Groups -
Social Media -

126
Q

What are impact of MNCs on the local economy?

A

Advantages

  • Offer good stable employment, prospects (advantages) for promotion and training
  • Local labour, wages, working conditions and job creation
  • can cause a multiplayer effect
  • Local community can learn new skills
  • Local businesses tend to operate in the surrounding area
  • Improve local infrastructure

Disadvantages

  • Risk to the local environment
  • Could be exploiting local areas by paying them less
  • May not hire locally and bring foreign workers
127
Q

What are the impact of MNCs on the national economy?

A 
FDI Flow - 
Balance of Payments - 
Technology and Skills Transfer - 
Consumers - 
Business Culture - 
Tax Revenues and Transfer Pricing -
128
Q

What is a joint venture?

A

Involves two separate businesses collaborating to achieve a shared goal

129
Q

What are the barriers to entry for global mergers and joint ventures?

A

Low brand awareness
Cultural and language difference
Knowledge of the market
Additional cost through exporting

Business (30 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions