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Business > Production, Finance and External Business Environment > Flashcards

Production, Finance and External Business Environment Flashcards

1
Q

what are the benefits of technology?

A
  • quicker
  • faster
  • cheaper
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2
Q

what are the disadvantages of technology?

A
  • expensive
  • can go wrong
  • not always reliable
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3
Q

what is job production?

A

making a unique and specific product to the customers order

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4
Q

what is batch production?

A

making a specific quantity of one product then a specific quantity of another. all happening on the same machine

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5
Q

what is mass/flow production

A

making very large amounts of the same product on the same machine

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6
Q

what are the advantages of job production?

A
  • satisfying to customers needs
  • high quality
  • sell fora high price
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7
Q

what are the disadvantages of job production?

A
  • labour intensive
  • expensive in terms of labour
  • take a long time
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8
Q

what are the advantages of batch production?

A

suit specific orders

-quick

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9
Q

what are the disadvantages of batch production?

A
  • down time

- issue with machinery

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10
Q

what are the advantages of flow production?

A

continuous process

-large quantises

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11
Q

what are the disadvantages of flow production?

A
  • not flexible
  • boring
  • issue with machinery
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12
Q

what are the 6 ways a product could have value added to it?

A
  • quality
  • design
  • convenience
  • speed
  • branding
  • unique selling point
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13
Q

what is total Quilty management?

A

where every stage is checked

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14
Q

what is just in time?

A

only buy in stock for today production

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15
Q

what are the benefits of just in time?

A
  • dont have to pay storage costs

- less stock to be broken

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16
Q

what are the benefits of having total quality management?

A
  • wont loose money on poor products

- less waste

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17
Q

what are the problems of having total quality management?

A
  • time consuming
  • have to train staff
  • slows down production
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18
Q

what is quality control?

A

checking the product at the end

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19
Q

what is quality assurance?

A

checking the product as you go along

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20
Q

what is revenue?

A

money coming into the business

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21
Q

what are costs?

A

money spent in order to run the business

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22
Q

what is the equation for total revenue?

A

price X quantity

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23
Q

what is the equation for total costs?

A

total revenue - total costs

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24
Q

how can a business bring more revenue in?

A
  • higher prices
  • new products
  • advertise more
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25
Q

what are fixed costs?

A

costs that never change no matter how many products you make i.e. rent

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26
Q

what are variable costs?

A

costs that change depending on how many you make i.e. electricity

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27
Q

what is the definition of break even?

A

how many products you must sell to cover all costs

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28
Q

why do you need to low your break even point?

A
  • set targets
  • helps monitor success
  • tells you if you are wasting time
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29
Q

what is margin of safety?

A

how many products you are above the break even point

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30
Q

what is the equation for break even?

A

fixed costs / (selling price - variable costs)

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31
Q

what are the problems with break even?

A
  • fixed costs often change
  • only a prediction
  • assumes printing never changes
  • assumes everything you make you will sell
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32
Q

what is specialised staff (devision of labour)?

A

when every member of staff does one specific job

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33
Q

what are the benefits of having specialised staff?

A
  • high quality
  • people stay
  • speed
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34
Q

what are the problems with having specialised staff?

A
  • boredom
  • bad if someones absent
  • limited
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35
Q

what is elastic demand?

A

when customers are very price sensitive i.e. on foods

36
Q

what is inelastic demand?

A

prices change, little different in sales i.e. clothes

37
Q

what is the definition of economies of scale?

A

the more you make the less each one is

38
Q

what is purchasing economies of scale?

A

discount for buying in bulk

39
Q

what is production EOS?

A

spreading the costs of production over more output

40
Q

what is marketing EOS?

A

promoting the brand name

41
Q

what is managerial EOS?

A

employing best specialist managers

42
Q

what is financial EOS?

A

borrowing at cheaper rates of interest

43
Q

what is risk bearing EOS?

A

spreading the risk over a range of products

44
Q

what are diseconomies of scale?

A

when becoming a very large business eventually means your average costs go up

45
Q

what is inward investment?

A

involves an external entity investing in the local economy i.e. IKEA going to Evesham

46
Q

how do the government help with inward investment?

A
  • grants
  • planning permission
  • investing in schools
47
Q

what criticism is given on regeneration program?

A
  • council tax increased to fund grants
  • money spent on something else
  • business rates go up
48
Q

when does the pound loose value?

A
  • when people wont buy our goods and services

- when foreign investors worry they wont get much interest if they save money in UK banks

49
Q

what is competitiveness?

A

the ability to be better then other countries

  • price
  • quality
  • skill
  • British brand name
50
Q

what is business ethics?

A

doing what is morally right

51
Q

what are chinas business ethics like?

A
  • poor working conditions
  • low wages
  • autocratic leader
  • behaviour of supervisors is harsh and slave like
52
Q

how do companies benefit from being ethical?

A
  • motivate staff
  • staff stay in jobs
  • good reputation
53
Q

what is sustainability?

A

meeting the needs of today without taking resources away form the future (renewable resources)

54
Q

what are the benefits of having a sustainable policy?

A
  • motivates staff
  • justify high prices
  • attracts middle income customers
55
Q

what are the problems of having a sustainable policy?

A
  • more expensive
  • increases costs and reduces prices
  • overrates as many customers don’t care
56
Q

what happens during the goos times?

A
  • luxury spending
  • easier to sell
  • new businesses
  • low unemployment
57
Q

what is sales revenue?

A

amount you bring in from selling your products

58
Q

what is costs of sales?

A

cost of your stock in which you sell to customers

59
Q

what is gross profit?

A

profit a company makes after taking away the costs

60
Q

what is the equation for gross profit?

A

gross profit/ sales X 100

61
Q

what net profit?

A

money left after costs but before tax

62
Q

what is the equation for net profit?

A

net profit/ sales X 100

63
Q

what effects the amount of profit a business makes?

A
  • demand for product
  • size of market
  • price people are willing to pay
64
Q

what is the money flowing into a business?

A
  • existing cash

- sales revenue

65
Q

what is the money flowing out of a business?

A
  • business costs

- business expenses

66
Q

what are the benefits of cash flow forecasting?

A
  • helps to see problems before they happen
  • set targets
  • judges managers success
67
Q

what are the problems with cash flow forecasting?

A
  • only a prediction
  • assumes people will pay on time
  • fails to predict expenses
68
Q

what are the 8 external sources of finance?

A
  • overdraft
  • trade credit
  • leasing
  • hire purchasing
  • bak loan
  • grant
  • share issue
  • mortgage
69
Q

what is an over draft?

A

withdrawing more than whats in your bank account

70
Q

what is trade credit?

A

asking you suppliers to wait for payment

71
Q

what is leasing?

A

paying for the right to use something

72
Q

what is hire purchasing?

A

owing something once the final instalment is payed

73
Q

what is a grant?

A

money form the government for a specific purpose

74
Q

what is share issue?

A

selling shares

75
Q

what is a mortgage?

A

loan based usually on property

76
Q

what are the advantages of an over draft?

A
  • good for cash flow

- quick to set up

77
Q

what are the disadvantages of an over draft?

A
  • interest everyday

- bank my cut it

78
Q

what are the advantages of a grant?

A
  • dont have to pay it back

- good for publicity

79
Q

what are the disadvantages of a grant?

A
  • long time to get one

- only use it for what the government say you can

80
Q

what are the advantages of share issue?

A
  • raise large amounts of money

- good for publicity

81
Q

what are the disadvantages of share issue?

A
  • you can loose control

- expensive to release shares

82
Q

what are the advantages of leasing?

A
  • cheaper than buying out right

- always get brand new version

83
Q

what are the disadvantages of leasing?

A
  • never own it

- pay for any damages

84
Q

what are the advantages of a loan (mortgage)?

A
  • eventually own item

- at the moment low interest rates

85
Q

what are the disadvantages of a loan (mortgage)?

A
  • take a long time to pay off
  • could loose house if not paid
  • a lot of interest payed
86
Q

what are the advantages of trade credit?

A

-good for cash flow

87
Q

what are the disadvantages of trade credit?

A
  • loose your supplier

- limited time to pay it back

Business (3 decks)

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