Pre Revsion Flashcards
Who are the main stakeholders in a business, and what are their interests?
• Entrepreneurs: Create and run businesses, aiming for profits.
• Investors: Provide capital, expecting returns (dividends or profits).
• Employees: Work in the business, seeking fair wages and good working conditions.
• Managers: Oversee operations to meet goals efficiently.
• Suppliers: Provide raw materials or goods, aiming for reliable payments.
• Consumers: Purchase goods or services, seeking quality and value.
• Government: Collects taxes and enforces regulations to ensure fairness and compliance.
• Local Community: Impacted by the business through employment and environmental considerations.
Define the types of relationships in business and explain each.
• Cooperative: Stakeholders work together towards mutual goals (e.g., employees and employers negotiating better working conditions).
• Competitive: Stakeholders act in their own interest, often at others’ expense (e.g., businesses competing for market share).
• Dependent: Stakeholders rely on each other to achieve goals (e.g., a business depending on suppliers for raw materials).
• Dynamic: Relationships constantly change over time, influenced by circumstances (e.g., a cooperative relationship turning competitive).
Provide examples of cooperative and competitive relationships between a business and the local community.
• Cooperative: A business sponsoring local events or charities to support the community.
• Competitive: A business lobbying against community opposition to a new development (e.g., building a factory).
What consumer protections are provided by the Sale of Goods and Supply of Services Act?
• Goods must be of merchantable quality: Fit for their purpose and as described.
• Goods must match their description: If described as “new,” they cannot be second-hand.
• Goods must be fit for purpose: Products should function as intended.
• Services must be provided with due care and skill: Performed by qualified individuals using quality materials.
What does the Office of the Ombudsman do for consumers?
The Ombudsman investigates complaints from the public about public sector bodies (e.g., government departments, local authorities). Protections include:
• Free complaint resolution.
• Fair and impartial investigations.
• Recommendations for corrective action.
What are the three ways employees can negotiate with employers?
• Individual Bargaining: Negotiation between an individual employee and employer.
• Collective Bargaining: Negotiation between a group of employees (often represented by a union) and the employer.
• State Intervention: Involvement of a third party (e.g., the WRC) to resolve disputes.
What protections does the Unfair Dismissals Act provide to employees?
• Prevents unfair dismissal: Employees cannot be dismissed without valid reasons (e.g., misconduct, redundancy).
• Fair procedures: Dismissal must follow proper procedures (e.g., warnings, investigations).
• Appeals process: Employees can appeal unfair dismissals through the WRC.
What protections does the Employment Equality Act provide?
The Act prohibits discrimination in the workplace based on nine grounds: gender, marital status, family status, age, disability, sexual orientation, race, religion, and membership of the Traveller community. Employers must ensure equal pay and opportunities.
How does the Workplace Relations Commission (WRC) assist employees and employers?
• Dispute resolution: Provides mediation and conciliation services.
• Adjudication: Hears cases on employment rights violations.
• Inspections: Ensures compliance with employment laws.
• Advice: Offers guidance on workplace legislation.
What skills and characteristics are important for an entrepreneur?
Skills:
• Decision-making: Ability to make informed, timely decisions.
• Interpersonal skills: Effectively communicating and working with others.
• Time management: Prioritizing tasks to maximize efficiency.
• Risk management: Identifying, assessing, and minimizing risks.
• Financial management: Budgeting, managing cash flow, and securing funding.
Characteristics:
• Proactive: Taking initiative to identify and act on opportunities.
• Innovative: Developing creative ideas, products, or services.
• Resilient: Remaining determined and persistent in the face of challenges.
• Ambitious: Setting and striving to achieve high goals.
• Confident: Believing in one’s abilities and decisions.
What is an intrapreneur, and how do they differ from an entrepreneur?
An intrapreneur is an employee who demonstrates entrepreneurial skills within a business by innovating and developing new ideas, products, or processes for the company.
• Unlike entrepreneurs, intrapreneurs do not own the business but act as leaders or problem-solvers within the organization.
What factors encourage workers to transition into entrepreneurship?
• Redundancy: Losing a job motivates individuals to start their own business.
• Dislike for current job: Seeking independence and control over their work.
• Recognition of a market gap: Identifying an opportunity to provide a unique product or service.
• Financial incentives: Desire for higher income potential.
• Government support: Grants, training programs, or tax incentives for startups.
Describe the different leadership styles.
• Autocratic: The leader makes all decisions without input from others. Suitable for urgent or high-risk situations.
• Democratic: Decisions are made collaboratively, with input from employees. Encourages creativity and teamwork.
• Laissez-faire: Minimal involvement from the leader, giving employees full control over their work. Works well with highly skilled, motivated teams.
Explain Maslow’s Hierarchy of Needs and how it relates to motivation.
Maslow’s theory suggests individuals are motivated by five levels of needs:
1. Physiological: Basic needs like food, water, and shelter.
2. Safety: Security in employment, income, and personal safety.
3. Social: Relationships, belonging, and teamwork.
4. Esteem: Recognition, respect, and personal achievement.
5. Self-actualization: Reaching one’s full potential and pursuing personal growth.
What are common barriers to effective communication?
• Language barriers: Use of jargon or technical terms.
• Lack of feedback: Misunderstandings due to unclear responses.
• Information overload: Too much information at once.
• Distractions: Noise or interruptions during communication.
• Attitudinal barriers: Lack of trust, prejudice, or negative attitudes.
What does the Data Protection Commission (DPC) do?
The DPC ensures compliance with data protection laws, including GDPR.
• Protects personal data: Ensures it is processed fairly and securely.
• Investigates breaches: Handles complaints about data misuse.
• Enforces penalties: Fines for non-compliance with data protection regulations.
• Provides guidance: Helps organizations comply with legal obligations.
Define planning in a business context.
Planning is the process of setting specific objectives and outlining steps to achieve them, ensuring resources are used effectively to meet goals.
What does SMART stand for in the context of planning?
SMART stands for:
• Specific: Goals should be clear and well-defined.
• Measurable: Progress should be trackable.
• Achievable: Goals must be realistic and attainable.
• Relevant: Objectives should align with overall business goals.
• Time-bound: Goals should have a specific deadline.
Explain SWOT analysis and its components.
SWOT analysis is a strategic tool used to evaluate a business’s position by analyzing:
• Strengths: Internal advantages (e.g., skilled staff, strong brand).
• Weaknesses: Internal disadvantages (e.g., poor financial resources).
• Opportunities: External chances to grow or improve (e.g., new markets).
• Threats: External challenges (e.g., competition, economic downturns).
What skills and characteristics are important for an entrepreneur?
Skills:
• Decision-making: Ability to make informed, timely decisions.
• Interpersonal skills: Effectively communicating and working with others.
• Time management: Prioritizing tasks to maximize efficiency.
• Risk management: Identifying, assessing, and minimizing risks.
• Financial management: Budgeting, managing cash flow, and securing funding.
Characteristics:
• Proactive: Taking initiative to identify and act on opportunities.
• Innovative: Developing creative ideas, products, or services.
• Resilient: Remaining determined and persistent in the face of challenges.
• Ambitious: Setting and striving to achieve high goals.
• Confident: Believing in one’s abilities and decisions.
What is an intrapreneur, and how do they differ from an entrepreneur?
An intrapreneur is an employee who demonstrates entrepreneurial skills within a business by innovating and developing new ideas, products, or processes for the company.
• Unlike entrepreneurs, intrapreneurs do not own the business but act as leaders or problem-solvers within the organization.
What factors encourage workers to transition into entrepreneurship?
• Redundancy: Losing a job motivates individuals to start their own business.
• Dislike for current job: Seeking independence and control over their work.
• Recognition of a market gap: Identifying an opportunity to provide a unique product or service.
• Financial incentives: Desire for higher income potential.
• Government support: Grants, training programs, or tax incentives for startups.
Describe the different leadership styles.
• Autocratic: The leader makes all decisions without input from others. Suitable for urgent or high-risk situations.
• Democratic: Decisions are made collaboratively, with input from employees. Encourages creativity and teamwork.
• Laissez-faire: Minimal involvement from the leader, giving employees full control over their work. Works well with highly skilled, motivated teams.
Explain Maslow’s Hierarchy of Needs and how it relates to motivation.
Maslow’s theory suggests individuals are motivated by five levels of needs:
1. Physiological: Basic needs like food, water, and shelter.
2. Safety: Security in employment, income, and personal safety.
3. Social: Relationships, belonging, and teamwork.
4. Esteem: Recognition, respect, and personal achievement.
5. Self-actualization: Reaching one’s full potential and pursuing personal growth.
What are common barriers to effective communication?
• Language barriers: Use of jargon or technical terms.
• Lack of feedback: Misunderstandings due to unclear responses.
• Information overload: Too much information at once.
• Distractions: Noise or interruptions during communication.
• Attitudinal barriers: Lack of trust, prejudice, or negative attitudes.
What does the Data Protection Commission (DPC) do?
The DPC ensures compliance with data protection laws, including GDPR.
• Protects personal data: Ensures it is processed fairly and securely.
• Investigates breaches: Handles complaints about data misuse.
• Enforces penalties: Fines for non-compliance with data protection regulations.
• Provides guidance: Helps organizations comply with legal obligations.
Define planning in a business context.
Planning is the process of setting specific objectives and outlining steps to achieve them, ensuring resources are used effectively to meet goals.
What are the key problems or limitations associated with using ratios?
• Ratios are based on past figures and cannot predict future performance.
• Certain factors like customer satisfaction cannot be measured by ratios.
• Ratios do not account for changes in the economic environment, such as new laws or market conditions.
• Changes in the way costs are calculated (e.g., depreciation of assets) can mislead results and affect profitability.
What are the liquidity ratios, and what do they indicate?
• Current Ratio:
Formula: Current Assets / Current Liabilities
• Ideal ratio: 2:1
• Indicates whether the business has enough assets to cover its liabilities.
• Acid Test/Quick Ratio:
Formula: (Current Assets - Closing Stock) / Current Liabilities
• Ideal ratio: 1:1
• Provides a stricter measure of liquidity by excluding closing stock, which may not be easily converted into cash.
What are the two profitability ratios, and what do they reveal?
• Gross Profit Margin (%):
Formula: (Gross Profit / Sales) x 100
• Indicates how much profit is made from each euro of sales before expenses.
• Should ideally improve over time or surpass competitors.
• Net Profit Margin (%):
Formula: (Net Profit / Sales) x 100
• Indicates how much profit remains from each euro of sales after all expenses are deducted.
• Should also ideally improve over time or surpass competitors.
• Return on Investment (ROI):
Formula: (Net Profit / Capital Employed) x 100
• Measures the percentage profit made on all long-term investments.
• Ideal: Higher than competitors and better than the interest rate from savings accounts.
• Capital Employed = Loans + Issued Shares + Retained Earnings.
What does the gearing ratio indicate?
• Gearing Ratio:
Formula: Loans / (Issued Shares + Retained Earnings)
Example: Loans = 25, Issued Shares + Retained Earnings = 100
• Gearing Ratio = 25:100 or 0.25:1.
• Indicates the proportion of funds sourced from loans versus owners’ funds.
• Lower gearing (e.g., 0.15:1) is preferred as it means less reliance on loans and a stronger financial position.
What is the Span of Control and Chain of Command?
• Span of Control: Refers to the number of employees a manager directly supervises.
• A wide span means a manager supervises many employees.
• A narrow span means fewer employees are supervised, leading to closer oversight.
• Chain of Command: Refers to the formal line of authority in an organization, indicating who reports to whom.
• A short chain allows quicker communication and decision-making.
• A long chain can lead to delays and bureaucratic inefficiencies.
What are the pros and cons of delayering?
Advantages:
• Improved communication: Reduces levels in the hierarchy, making communication faster.
• Cost savings: Fewer managers reduce wage expenses.
• Empowerment: Gives more responsibility to employees at lower levels.
Disadvantages:
• Job losses: Can lead to redundancies, affecting morale.
• Overwork: Managers with a wider span of control may become overburdened.
• Resistance to change: Employees may feel insecure about the restructuring process.
What are the four types of management control, and what benefits do they provide?
- Stock Control: Ensures the business has the right amount of stock at the right time.
• Benefits: Reduces costs (e.g., storage, waste) and avoids shortages. - Quality Control: Checks that goods or services meet required standards.
• Benefits: Improves customer satisfaction and reduces complaints. - Financial Control: Monitors income, expenses, and budgets to ensure financial stability.
• Benefits: Helps avoid overspending and ensures profitability. - Credit Control: Manages credit offered to customers and ensures timely payments.
• Benefits: Improves cash flow and reduces bad debts.
What is Human Resource Management (HRM), and what are its benefits?
• HRM Definition: The process of recruiting, training, and managing employees to achieve organizational goals effectively.
Benefits:
• Attracts top talent: Through effective recruitment processes.
• Enhances employee performance: Through training and development.
• Increases employee motivation: By offering rewards and recognition.
• Reduces turnover: By fostering a positive workplace culture.
• Ensures compliance: Helps the business adhere to employment laws and regulations.
What is the purpose of insurance, and how can a business reduce risks?
• Purpose of Insurance: Protects against financial losses due to unforeseen events, providing security for individuals and businesses.
• Risk Reduction Strategies:
• Installing safety equipment (e.g., fire alarms, CCTV).
• Regular maintenance of equipment and premises.
• Training staff on health and safety procedures.
What types of insurance do businesses typically purchase?
• Public Liability Insurance: Covers claims from third parties injured on the premises.
• Employer’s Liability Insurance: Protects against claims from employees injured at work.
• Product Liability Insurance: Covers claims related to faulty or dangerous products.
• Fidelity Guarantee Insurance: Protects against fraud or theft by employees.
• Business Interruption Insurance: Covers lost income during unforeseen events like fires or floods.
What are the principles of insurance?
• Utmost Good Faith: Applicants must disclose all material facts.
• Insurable Interest: The insured must have a financial interest in what is being insured.
• Indemnity: Compensation is provided for the actual loss only, preventing profit.
• Subrogation: The insurer has the right to recover costs from third parties responsible for the loss.
• Contribution: If multiple policies cover the same risk, insurers share the cost of compensation.
How is Net Pay calculated?
Net Pay = Gross Pay - Deductions
• Gross Pay: Total earnings before deductions (includes basic pay, overtime, and bonuses).
• Deductions:
• Statutory Deductions: Required by law (e.g., PAYE, PRSI, USC).
• Voluntary Deductions: Agreed upon by the employee (e.g., pensions, union fees).
What are the stages of the Product Life Cycle, and what do they represent?
- Introduction: The product is launched, and sales are low as the market becomes aware. High marketing costs.
- Growth: Sales increase as the product gains acceptance, and profits start to rise.
- Maturity: Sales peak and profits are stable, but competition intensifies.
- Saturation: Market becomes oversaturated, and sales plateau or decline.
- Decline: Sales and profits fall due to changing trends or new competition.
What are the main pricing strategies businesses use?
• Penetration Pricing: Setting a low price to gain market share quickly.
• Price Skimming: Setting a high price initially to recover costs and appeal to early adopters.
• Cost-Plus Pricing: Adding a fixed percentage to the production cost.
• Psychological Pricing: Setting prices just below whole numbers (e.g., €9.99).
• Loss Leader: Selling a product at a loss to attract customers and increase sales of other products.
What are the main types of advertising?
• Informative Advertising: Provides factual information about a product or service.
• Persuasive Advertising: Aims to convince consumers to purchase a product by appealing to emotions.
• Reminder Advertising: Keeps a product in the public’s mind (e.g., seasonal ads).
• Comparative Advertising: Compares a product to competitors, highlighting advantages.
What are the pros and cons of branding for a business?
Advantages:
• Creates customer loyalty.
• Allows premium pricing.
• Differentiates products from competitors.
• Makes it easier to launch new products (brand trust).
Disadvantages:
• High marketing costs.
• Difficult to repair reputation after damage.
• Risk of brand dilution if the brand is overextended.
What are the three sectors of the economy?
• Primary Sector: Involves natural resources (e.g., farming, fishing, mining).
• Secondary Sector: Involves manufacturing and construction (e.g., factories, builders).
• Tertiary Sector: Involves services (e.g., retail, education, healthcare).
What are two key trends in Ireland’s construction industry?
- Sustainability: Increased focus on eco-friendly building materials and energy-efficient designs.
- Housing Demand: Growing demand for affordable housing due to population growth and urbanization.
What are two major trends in Ireland’s farming sector?
- Sustainable Farming: Adoption of environmentally friendly practices like reducing emissions and improving biodiversity.
- Technological Advancements: Use of drones, AI, and automation to improve efficiency and productivity.
How does a Franchise differ from a Strategic Alliance?
• Franchise: A business model where a franchisee pays a franchisor to use its brand and business model (e.g., McDonald’s). The franchisee runs the business but must follow strict guidelines set by the franchisor.
• Strategic Alliance: A partnership between two independent businesses to share resources or expertise for mutual benefit, without merging or losing independence.
What are the benefits of a co-operative structure?
- Democratic Decision-Making: Each member has an equal say, regardless of investment size.
- Shared Profits: Profits are distributed among members rather than going to shareholders.
What are the stages of the Product Life Cycle, and what do they represent?
- Introduction: The product is launched, and sales are low as the market becomes aware. High marketing costs.
- Growth: Sales increase as the product gains acceptance, and profits start to rise.
- Maturity: Sales peak and profits are stable, but competition intensifies.
- Saturation: Market becomes oversaturated, and sales plateau or decline.
- Decline: Sales and profits fall due to changing trends or new competition.
What are the main pricing strategies businesses use?
• Penetration Pricing: Setting a low price to gain market share quickly.
• Price Skimming: Setting a high price initially to recover costs and appeal to early adopters.
• Cost-Plus Pricing: Adding a fixed percentage to the production cost.
• Psychological Pricing: Setting prices just below whole numbers (e.g., €9.99).
• Loss Leader: Selling a product at a loss to attract customers and increase sales of other products.
What are the main types of advertising?
• Informative Advertising: Provides factual information about a product or service.
• Persuasive Advertising: Aims to convince consumers to purchase a product by appealing to emotions.
• Reminder Advertising: Keeps a product in the public’s mind (e.g., seasonal ads).
• Comparative Advertising: Compares a product to competitors, highlighting advantages.
What are the pros and cons of branding for a business?
Advantages:
• Creates customer loyalty.
• Allows premium pricing.
• Differentiates products from competitors.
• Makes it easier to launch new products (brand trust).
Disadvantages:
• High marketing costs.
• Difficult to repair reputation after damage.
• Risk of brand dilution if the brand is overextended.
What are the three sectors of the economy?
• Primary Sector: Involves natural resources (e.g., farming, fishing, mining).
• Secondary Sector: Involves manufacturing and construction (e.g., factories, builders).
• Tertiary Sector: Involves services (e.g., retail, education, healthcare).
What are two key trends in Ireland’s construction industry?
- Sustainability: Increased focus on eco-friendly building materials and energy-efficient designs.
- Housing Demand: Growing demand for affordable housing due to population growth and urbanization.
What are two major trends in Ireland’s farming sector?
- Sustainable Farming: Adoption of environmentally friendly practices like reducing emissions and improving biodiversity.
- Technological Advancements: Use of drones, AI, and automation to improve efficiency and productivity.
How does a Franchise differ from a Strategic Alliance?
• Franchise: A business model where a franchisee pays a franchisor to use its brand and business model (e.g., McDonald’s).
• The franchisee runs the business but must follow strict guidelines set by the franchisor.
• Strategic Alliance: A partnership between two independent businesses to share resources or expertise for mutual benefit, without merging or losing independence.
What are the benefits of a co-operative structure?
- Democratic Decision-Making: Each member has an equal say, regardless of investment size.
- Shared Profits: Profits are distributed among members rather than going to shareholders.
What are the effects of rising interest rates on consumers, businesses, and employees?
• Consumers: Increased loan and mortgage repayments reduce disposable income. Savings are more attractive due to higher returns, leading to less spending.
• Businesses: Higher borrowing costs discourage investment and expansion. Reduced consumer spending impacts sales and profits.
• Employees: Fewer job opportunities as businesses cut costs or delay hiring. Wage growth may slow as businesses reduce expenses.
What happens when inflation rises for consumers, businesses, and employees?
• Consumers: Reduced purchasing power as prices rise faster than wages. Savings lose value unless interest rates match inflation.
• Businesses: Increased costs of raw materials and wages reduce profits. Uncertainty makes long-term planning difficult.
• Employees: Pressure to demand higher wages to keep up with rising living costs. Potential job insecurity as businesses may cut costs.
What are the impacts of a stronger Euro on consumers, businesses, and employees?
• Consumers: Imported goods become cheaper, increasing purchasing power. Foreign holidays become more affordable.
• Businesses: Exporters struggle as their products become more expensive for foreign buyers. Importers benefit as raw materials and goods become cheaper.
• Employees: Export-focused industries may experience job losses. Import-dependent industries may see growth, leading to more job opportunities.
How can the government address inflation?
• Short-Term Action: Increase interest rates to reduce consumer spending and borrowing.
• Long-Term Action: Invest in infrastructure or productivity improvements to increase supply and reduce production costs.
How does the government impact the labour market?
• Minimum Wage: Setting a legal minimum wage to protect low-income workers.
• Employment Legislation: Enforcing laws on working hours, contracts, and equality.
• Job Creation: Investing in infrastructure projects or providing incentives for businesses to hire workers.
• Education and Training: Offering programs to upskill workers and reduce unemployment.
Define Free Trade.
Free trade is the movement of goods and services between countries without tariffs, quotas, or other restrictions.
What are the advantages of free trade for businesses and consumers?
• For Businesses: Access to larger markets and more customers. Opportunity to source cheaper raw materials.
• For Consumers: Lower prices due to increased competition. Greater variety of products and services.
What are some examples of trade barriers imposed by governments?
• Tariffs: Taxes on imported goods to make them more expensive.
• Quotas: Limits on the quantity of a product that can be imported.
• Subsidies: Financial support to domestic industries to make their goods cheaper than imports.
• Regulations: Strict standards or rules that make it harder for foreign companies to compete.
