Brainscape's Knowledge GenomeTM

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


See full index

AAA Business Y12 > Sept > Flashcards

Sept Flashcards

1
Q

What is a Primary Industry?

A

Primary production involves the acquiring of raw materials. for example, precious metals are mined from the ground and oil is drilled up from oil wells. This is can be known as extractive production.

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

What is a Secondary Industry?

A

Also known as the manufacturing and assembly process, it involves the conversion of raw materials into components. This includes making oil into plastics and construction of houses.

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

What is a Tertiary Industry?

A

Tertiary industry refers to the commercial services that support the production and distribution of goods. some examples of this are hairdressers, hospitals, fast food chains, supermarkets and schools.

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

Why is there a decline in the Primary industry in the UK?

A
  • It’s easier to import from other countries
  • Mechanisation over manual workers
  • robots taking jobs
  • businesses relocate overseas
  • uk manufacturing has not survived in the increasingly competative de industrialisation
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Why is there a decline in the secondary industry in the UK?

A
  • It’s easier for businesses to manufacture abroad, abroad companies can take advantage of lower national wage standards, increases competition.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Why is there a increase in the tertiary industry in the UK?

A
  • disposable income is higher = more money for people to spend
  • People have more free time and become wealthier
  • Impact of IT - more employment, opportunities created
  • financial services have been a growth area and many new jobs have been created
  • education system garners people for the tertiary sector.
  • UK has become more affluent and service demand is greater.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What is a Need?

A
  • Peoples needs are limited. They include things which are needed to survive, such as food, warmth, shelter and security. human’s also have psychological needs eg recognition and love
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

What is a want?

A

Wants, are infinite. People constantly aim for a better quality of life, might include better housing, healthcare, education etc.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

What is a Business?

A

A collective that provides a good or service to customers to gain profit, usually.
Businesses are here to meet our needs and wants

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

What is a Good?

A

A good is tangible eg food and clothes

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

What is a service?

A

A service is not tangible eg taxi ride or haircut

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

What are the benefits of SME’s to the Economy?

A
  • Increased flexibility - smaller firms can adapt to change quicker than large firms, helps UK economy quicker with more orders abroad.
  • Wage levels might fall as a result of smaller firms. Wages are negotiated on a one to one basis with the owner. Keeps business costs down
  • More casual and part time work may have been created. Small firms are more reluctant to employ full time staff because it is more exspensive. Casual and part time workers increase flexibility.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Reasons for popularity of SME’s?

A
  • Rising unemployment - People with redundancy payments as capital for their own business.
  • the government and local authorities introduced a number of measures to encourage the development of small businesses. This includes:
  • Business start up schemes - funds for small businesses
  • business link, provides advice
  • European initiatives
  • training schemes
    __—__– Personal service
  • flexibility and efficiency
  • Owners preference, easier to make deals
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Benefits of SME’s to UK?

A
  • Staff loyalty may have been improved due to personal level staff deal with eachother on a daily basis
  • consumers might benefit from the growth small firms results in more competition
  • further difference is their role innovation. SME’s adapt quickly. breeding ground for new industries.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

List Facts about SME’s in the UK.

A
  • In 2013, there were 4.9 million businesses in the UK, Over 99% were small and medium enterprises
  • Small and medium enterprises employed 14,424,000 people in the UK in 2013.
  • microbusinesses are businesses with 0.9 employees. there were 5.0 million micro businesses in the uK in 2014 accounting for 96% of all businesses.
  • ALthough the vast majority of businesses in the UK employ fewer than 10 people, this sort of business only accounts for 33% of employment and 19% of turnover.
  • Large businesses with more than 250 employees accounted for less than 0.1% of businesses in 2014.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What’s an entrepreneur?

A

Someone who has a business entreprise, With success equating to profit and failure leading to personal ruin.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Define oligopolistic?

A

Multiple companies control the market.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What’s a stakeholder?

A

Anyone who has an interest in a particular business, e.g. Coca Cola.

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

Who are the primary stakeholders of a company?

A
  • Owners
  • Suppliers
  • employees
  • customers
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Who are the secondary stakeholders of a company?

A
  • consumer groups
  • unions
  • society
  • media
  • local community
  • social interest groups
  • environmental groups
21
Q

Reasons for Stakeholders: Shareholders

A
  • high profit
  • high dividened
  • long term growth
  • prospect of capital gain
  • a say in the business
    a positive corporate image
  • preferential treatment as customers
22
Q

Reasons for Stakeholders: Employees

A
  • high pay
  • good working conditions
  • fringe benefits
  • promotion prospects
  • job security
  • fair treatment
  • health and safety
  • training opportunities
23
Q

Reasons for Stakeholders: Customers

A
  • value for money
  • low prices
  • high quality products
  • good service
  • innovation
  • certain and regular supply
  • choice of goods i.e variety
  • clear and accurate information
24
Q

Reasons for Stakeholders: Suppliers

A
  • prompt payment
  • long term relationship with firm
  • large size and high value contracts
  • frequent and regular orders
  • fair prices
  • growth in firm leading to more orders
25
Q

Reasons for Stakeholders: Creditors

A
  • prompt payment
  • payment of interest on outstanding debt
  • repayment at agreed date
  • credit worthiness of the organisation
  • sufficient positive cash flow
26
Q

Reasons for Stakeholders: The community

A
  • Employment prospects
  • safeguarding the environment
  • acceptance of social responsibility
  • ethical behaviour
27
Q

Reasons for Stakeholders: Gov’t

A
  • Compliance with laws and regulations
  • efficient use of resources
  • employment
  • contribution to the national economy
  • payment of taxes
28
Q

Why do people start up their own businesses?

A
  • To gain a profit, the motive for profit is generally the main reason for starting a business
  • To turn a hobby or a pastime into a business, a specialist cake store is most likely owned by someone who has a deep passion for cake baking.
  • To be their own boss, they have control of their own destiny, not being underappreciated by a large corporation
  • To use redundancy money, some new business people are forced into setting up a business because of redundancy. losing a job, with little chance of finding another one in the near future, is often reason enough to start a business. People will use their redundancy payments as capital to start up their own business
29
Q

What are characteristics of entrepreneurs?

A
  • Risk takers, entrepreneurs sometimes have to risk capital and their own time to try to create profits. They may remortgage the house, borrow from family and friends to pursue their business idea.
  • Having creativity and being innovative, creativity in business means the ability tocome up with innovative ideas and concepts
  • Being hard working, successful entreprenuers are, generally hard working, it is estimated that entrepreneurs in the UK work around 52 hours a week compared with the average 38 hours for an employed person.
  • Being determined and having perseverance, entrepreneurs also need to be determined, as new businesses have low success rates. Entrepreneurs must also have considerable perseverance, and be willing to keep trying if initial fails
  • Be an effective organiser, entrepreneurs have to organise effectively, considering factors like labour, buying inputs, raw materials etc.
30
Q

What’s included in a business plan?

A
  • Executive summary, description of the business idea
  • Marketing plan, market research into the needs of the business, size of the market, and the level of competition.
  • Operations plan, Where the business will be located, production methods and any equipment needed. in addition, information on the costs of production and where the business will buy supplies may also be included.
  • Human resources plan, Number of employees and the skills, experience and qualifications they require will be outlined.
  • the financial plan, will include a sales forcast indicating potential revenues, a cash flow forecast for the first 12 months.
  • a profit and loss and balance forecast for the end of the first year.
  • a break even analysis
31
Q

What are the benefits of a business plan?

A
  • When complete the business plan presents the business owners with a clear set of instructions on how to run the business.
  • Writing a business plan forces the entrepreneur to look at every key aspect of the future business equally.
  • A comprehensive business plan will allow business owners to check progress against objectives, monitor cash flow.
  • A business plan is also needed for potential investors or when seeking finance from banks. without a business plan it is highly unlikely that capital could be attracted from people or institutions outside of the business.
32
Q

What are the potential drawbacks of a business plan?

A
  • Market research costs time and money, resources which might be better spent elsewhere in the business.
  • How do you predict what your income will be? Market research can only provide an estimate, how reliable is the data?
  • An inaccurate business plan with unachievable objectives can give entrepreneurs false hope, leading to failed investments.
33
Q

What’s a stakeholder?

A

A stakeholder in a business are any individual or group which is affected by the business and so has an interest in its activites.

34
Q

What is a Merit Good?

A
  • Goods which, if left to the private sector market mechanism, would be under provided.
  • Gov’t has to step in to ensure that merit goods are produced in sufficient quantity
  • healthcare and education.
35
Q

What are Public goods?

A
  • Public goods are NON RIVALRY and NON EXCLUDABLE
  • no one can be excluded from using that good
  • e.g If i eat a cake, no one else would be able to eat a cake, that is a rivalled and excluded private good.
  • If i breathe ai, it doesn’t reduce the amounts of air available to others, this makes it a public good.
36
Q

Location factors: Costs

A
  • certain businesses eg sole traders will have limited capital, so they will need to keep their costs low.
  • Location costs include: planning permission, purchasing/rental lease, refurbishment, business rates, labour costs and transport costs.
  • businesses will need to consider location of location on its success, this depends on products and services and the market it will operate
37
Q

Location factors: The market and Competition

A
  • Retail location will vary according to access to customers, but there will be a balance between customer footfall and rental/lease costs.
  • retail location must look carefully at the anchor tenant. An anchor tenant is usually the first and the leading tenant in a shopping centre whose prestige and name recognition attracts customers
  • Costs will vary according to likely sales and customer potential but within each price band there will be both good and bad locations
38
Q

Location factors: Infrastructure

A
  • Economies of concentration occur when a number of businesses in the same, or related industries, locate close together. The both can gain mutual advantages.
  • Must locate somewhere where it can access markets eg roads, shipping etc.
39
Q

Location factors: Labour

A
  • A business has to consider locating itself on terms of labour force on factors like cost of labour, availability of workers and skills of labour
  • manufacturing businesses have relocated to places like China and the far east because labour costs are very low
40
Q

Location factors: Government influences

A
  • Cost of labour can be affected by the availability of government grants, giving incentives to move to particular regions of a country and by governmental taxation policies
  • Availability of low cost and suitable land resources.
41
Q

Location factors: Social reasons

A
  • Managers will want to live in a location that suits their families, eg leisure facilities, good schools and low crime
42
Q

What are footloose businesses?

A

Footloose businesses are businesses that move from location to location, though still influenced by the same factors that dictate national location of business

  • Changing patterns of trade
  • improved communications
  • freer flows of capital
43
Q

What are the different location factors?

A
  • Social reasons
  • Government influences
  • market and competition
  • infrastructure
  • labour
  • costs
44
Q

Who are the different stakeholders in a business?

A
  • government
  • community
  • creditors
  • shareholders
  • customers
  • employees
  • suppliers
45
Q

What are the objectives of public and private sector businesses?

A
  • Private sector businesses aim to make a profit, increase the shareholder value (measured by dividened paid and the share price) and also improve ethics (could be environmental)
  • Public sector is made up of organizations which are owned by the government, they provide us with public and merit goods, if left to the private sector, would be underprovided.
46
Q

Advantages and disadvantages of sole traders?

A
  • Costs are low due to the simplicity of setting up and no legal formalities, so there is little administrative cost.
  • The sole trader benefits from fast decision making and may (within employment law) hire and fire as they please
  • Limited capital available to them. Sole traders often rely on their own savings or business loans
  • Sole trader has unlimited liability. This means that the business owner is liable for all the debts of the business, up to and including the value of all assets.
47
Q

Advantages and disadvantages of Partnerships?

A
  • each partner ‘joint and severally liable.
  • Greater availability of capital, shared decision making and pressure is likely to be reduced with different partners having seperate
  • Capital can still be limited with the same problems of raising external capital that a sole trader has.
  • the partners still have unlimited liability of partners
  • If someone in the partnership dies, it is dissolved and this can cause complications in re-establishing the partnership.
48
Q

Advantages and disadvantages of Private Limited companies?

A

ADVANTAGES - limited liability
- shares can only be sold if all the shareholders agree - total control is not lost
- possible tax advantages for the owners
DISADVANTAGES - Legal procedure in setting up, increasing costs
- profits have to be shared with shareholders
- financial information is in the public domain

49
Q

Advantages and disadvantages of Public Limited companies?

A

ADV - limited liability
- the business continues if one of the owners die
- increased market presence
- likely to have economies of scale
DISADV - Increased cost in setting up
- anyone can buy shares, threat of losing control
- increased legal requirements
- increased size may result in inefficiencies
- more information has to be published to the public domain

AAA Business Y12 (9 decks)

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