quiz

Question 1

dividends

Answer 1

a portion of the profits of the firm given to shareholders

Question 2

ethical

Answer 2

morally correct behaviour eg treating workers and environment well

Question 3

fair trade

Answer 3

buying raw materials at a price that allows a reasonable standard of living for the suppliers and often above at the market price

Question 4

company growth

Answer 4

the increase over time of the revenue of a business. economic growth refers to the increase in size of the whole economy ie the sales of all business in a nation

Question 5

limited liability

Answer 5

shareholders can only lose money invested in the company, not their entire personal wealth if the business collapses.

Question 6

market capitalisation

Answer 6

the value of the company as measures by the stock market

= number of shares x share price

Question 7

mission

Answer 7

the main purpose of a organisation

Question 8

non profit organisation

Answer 8

an incorporated organisation which exists for the interest of its members or as a charity, so there new no shareholders only trustees benefit financially eg Kimbolton School

Question 9

objective

Answer 9

short term specific measurable targets eg 1m sales next month

Question 10

private limited company

Answer 10

a limited liability business where shares are not freely available for sale, decisions can be made by the owners. they are usually small or medium sized firms but there are exceptions eg virgin

Question 11

private sector

Answer 11

any organisation that is not government run or owned

Question 12

profit

Answer 12

is the difference between the firms revenues from its trading activities and its total costs. it is a reward for risk and a return on capital investment

Question 13

profit formula

Answer 13

total revenue - total costs

Question 14

public sector organisations

Answer 14

government owned organisation

Question 15

public limited companies

Answer 15

large firm whose shares can be brought and sold by the general public on the stock exchange. the owners appoint managers to run the businesses

Question 16

revenue

Answer 16

the income generated by sales of a product

Question 17

revenue formula

Answer 17

price x quantity sold

Question 18

share

Answer 18

a certificate indicating part ownership of a company. the share entitles the holder to receive dividends ad voting rights to affect the way the firm is run

Question 19

shareholder

Answer 19

part owners of a business who can vote at the AGM and receive dividens

Question 20

sole trader

Answer 20

an individual who owns and runs a business, they operate under unlimited liability so they are reasonable for all business debts

Question 21

a business

Answer 21

an organisation that exists to provide goods and services on a commercial basis to customers

Question 22

the transformation process

Answer 22

describes what happens inside the business. this is where value is added to inputs to create outputs

Question 23

cell

Answer 23

capital, enterprise, land, labour

Question 24

added value formula

Answer 24

added value = selling price - the cost of brought in materials, components and services

Question 25

smart

Answer 25

specific, measurable, achievable, relevant, time bound

Question 26

fixed costs

Answer 26

costs that do not change directly with the level of output

Question 27

variable costs

Answer 27

costs that change directly with output. they will increase by a set amount each time a new unit is made

Question 28

total costs formula

Answer 28

fix costs + variable costs