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GCSE Business: Theme 1 Flashcards > Theme 1 Practise Qu's > Flashcards

Theme 1 Practise Qu's Flashcards

1
Q

(2)

Identify two characteristics of a successful entrepreneuer.

A
  • Risk taking
  • Resilient
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2
Q

(2)

Identify two risks an entrepreneur may face when starting a business.

A
  • Lack of security
  • Business Failure (50% of businesses fail to sruvive within the first 5 years).
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3
Q

(2)

What is “limited liability”?

A
  • Where the owner’s assets AREN’T lost
  • when the firm FAILS.
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4
Q

(3)

Explain why do new ideas come about in a new business?

A
  • Changes in TECHNOLOGY
  • REDUCES the impact of technology becoming OBSELETE.
  • able to MEET customer’s needs and wants.
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5
Q

(3)

Explain one way an entrepreneur can reduce the risk of business failure.

A
  • Conducting MARKET RESEARCH
  • Understanding customer’s specification from QUANTITATIVE AND QUALITATIVE DATA.
  • Firm can tailor its products to customer’s specifications, increasing success.
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6
Q

(3)

Explain one way a new business can add value to its product.

A
  • ADAPTING a product
  • creates a USP
  • customers would be intruiged by the product’s QUALITY.
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7
Q

(3)

Outline one impact of competition on a new business.

A

-New business LACK SURVIVAL.
- Many other DOMINATING firms are in the SIMILAR field.
- Reduces CUSTOMER ATTRACTION.

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8
Q

(3)

Outline one reason why a business needs to identify customer needs.

A
  • Changes in CUSTOMER SPECIFICATION.
  • TAILORING products to customer specification.
  • INCREASES customer satisfaction.
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9
Q

(6)

Discuss the impact on a small business from adapting existing products to
develop new business ideas.

A
  • Less INNOVATION.
  • Customers may not be SATISFIED.
  • Customers may go to COMPETITORS.
  • Adding value.
  • Creates a USP.
  • Customers intruiged by QUALITY.
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10
Q

(3)

Explain one advantage of customers from increased competition.

A

-Customers have more CHOICE.
- more competition = more products being AVAILABLE in the MARKET.
- Customers able to buy a product based on their NEEDS.

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11
Q

(3)

Explain one reward for an entrepreneur when starting a new business.

A
  • Profit
  • Total Revenue EXCEEDS Total Costs.
  • Able to be SOLVENT.
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12
Q

(1)

Define primary market research.

A

Gathering CONCRETE pieces of data that has NOT been CREATED by OTHERS.

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13
Q

(3)

Explain one way a business can use market segmentation to target customers.

A
  • Lifestyle.
  • Able to TAILOR products/services to customer’s specifications.
  • Customers will REPEAT PURCHASE if products meet their NEEDS.
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14
Q

(3)

Outline a benefit of using secondary research.

A
  • Identify GAPS in MARKET
  • Research conducted by OTHERS.
  • Identify CUSTOMER’S SEPCIFICATION.
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15
Q

(4)

List two examples of primary and secondary research.

A

Primary Research:
- Questionnaires
- Focus Groups

Secondary Research:
- Internet
- Government

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16
Q

(3)

List 3 financial objectives

A
  • Survival
  • Profit
  • Financial Security
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17
Q

(3)

List 3 non-financial objectives

A
  • Independence
  • Social objectives
  • Personal Satisfaction
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18
Q

(1)

What is e-commerce?

A

The online transactions made via PCs.

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19
Q

(4)

List two benefits and drawbacks of e-commerce.

A

BENEFITS:
- Accessing wider markets
- 24/7

DRAWBACKS:
- Competition
- Limited connections with customers.

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20
Q

(6)

Discuss the benefits of a small business using e-commerce.

A
  • Able to have access to WIDER MARKETS
  • Able to compare with COMPETITORS.
  • Finding and filling a gap in their MARKET
  • Providing increased PRODUCT RANGE
  • INCREASES customer attention
  • REPEAT PURCHASES via services occur often.
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21
Q

(4)

List the four Proximity factors affecting the location of the firm.

A

Proximity to…
- MARKET
- COMPETITORS
- MATERIALS
- LABOUR

22
Q

(3)

Explain one way that a small business could locate itself to grow.

A
  • Proximity to MARKET.
  • Develops convenience.
  • Increases target market.
23
Q

(3)

Explain one way that the internet may affect where a small business chooses to locate.

A
  • One way is the efficiency of its location.
  • The firm could locate somewhere less populated as it would be cheaper for them.
  • Thus, can attract customers through either physical store or via the internet.
24
Q

(1)

Which one of these isnt a factor of the marketting mix.
A) Promotion
B) Price
C) Produce
D) Product

A

C) Produce

25
Q

(3)

Explain one way that a small business can meet customers needs and wants through the marketting mix.

A
  • Price
  • Rising inflation = rising prices
    -reduce VC per unit
  • Reducing prices on products.
  • Customers have more disposable income.
26
Q

(3)

Explain one way that a small business can have better logistics through the marketting mix.

A
  • Place
  • Locate close to suppliers
  • Faster distribution of products.
27
Q

(3)

Explain one disadvantage to a small business of using an overdraft as a source
of business finance.

A
  • Increasing interest rates
  • Have to repay bank at any time.
  • May not have the funds due to low cost of borrowing.
28
Q

(3)

Give one disadvantage of a small business using personal savings to expand its premises.

A
  • Amount could be limited.
  • Less control for cost of expansion.
  • Firm has to move to another SoF.
29
Q

(3)

Give one advantage of a small business using share capital as a source of finance.

A
  • Large sums of capital raised.
  • No repayment
  • Able to invest in other shares.
30
Q

(3)

Explain one benefit to an entrepreneur of buying a franchise to start a business.

A
  • Benefits from NATIIONAL ADVERTISING CAMPAIGNS.
  • has the access to a larger advertising budget.
  • FRANCHISE has increased BRAND AWARENESS.
31
Q

(3)

Explain a drawback of a small business buying a franchise

A
  • Lack of CONTROL.
  • Small firm has to TRUST THE FRANCHISEE.
  • Franchisee could lack making the right business decisions.
32
Q

(6)

Discuss the impacts of being a sole trader than a partnership.

A

BENEFITS:
- One person runs the firm.
- Increased AUTONOMY unlike partnership (3-21 people)
- Able to make decisions with no pressure.

DRAWBACKS:
- Has unlimited liability
- Has no separate legal identity
- Owner’s assets are lost during business failure.

33
Q

(3)

Explain one reason why it is important to include financial information in a
business plan.

A
  • REDUCES financial risk.
  • Cash flow forecast outlines POTENTIAL issues.
  • Business can PLAN for these issues IN ADVANCE.
34
Q

(6)

Discuss the importance of cash to the survival of a small business.

A
  • Business able to pay its suppliers on time
  • Increases cash inflows, cash outflows decreases, such as rent.
  • Net cash flow is positive.
  • Firm is able to maintain this via a cash flow forecast.
  • Able to prepare in advance.
  • Preventing insolvency of small business.
35
Q

(2)

Outline two reasons why a business might create a business plan.

A
  • Useful to show INVESTORS
  • HELPFUL with PLANNING.
36
Q

(7)

What are the seven factors of a business plan

A
  • Business Idea
  • Aims and Objectives
  • Marketting mix
  • Target Market
  • Sales Forecasting
  • Location
  • Sources of Finance
37
Q

(3)

Give three internal stakeholders.

A
  • Shareholders
  • Managers/Owners
  • Employees
38
Q

(6)

Give six external stakeholders

A
  • Pressure Groups
  • Government
  • Suppliers
  • Customers
  • Investors
  • Local community
39
Q

(3)

Give one disadvantage of a small business not paying its employees on time.

A
  • Employees would feel unmotivated.
  • Increased disputes between employees and manager.
  • Decreased productivity.
40
Q

(1)

State a type of technology that a small business could use.

A

Digital Payments (PayPal).

41
Q

(6)

Discuss the impacts of a small business using digital payment systems, such as PayPal.

A
  • Increases CONVENIENCE for customers
  • Increases POTENTIAL CUSTOMERS
  • Done through E-COMMERCE
  • It is FLEXIBLE
  • Transactions can occur 24/7
  • INCREASES SALES for small firm.
42
Q

(3)

What does the Consumer Rights Act 2015 state?

A
  • Able to REFUND.
  • Product has to be FIT FOR PURPOSE.
  • HIGH quality products sold.
43
Q

(1)

State the act that comes under the legislation for employees.

A

Equality Act 2010.

44
Q

(3)

Explain how changing consumer legislation will affect the small business.

A
  • Has to TAILOR its service towards consumers.
  • Required to meet consumer laws.
  • Products/Services sold at high quality.
45
Q

(3)

Explain how employee legislation will change if a small business has a new manager.

A
  • New manager could require different objectives/aims.
  • Could cause changes in working practises.
  • Employees could be treated differently than before.
46
Q

(3)

Give one way that inflation will affect the economic climate.

A
  • Higher PRICES on products.
  • Higher COST PER UNIT on products.
  • Consumers will have less DISPOSABLE income.
47
Q

(3)

Explain why a small business would want a reward for saving than a cost of borrowing.

A
  • Money is in a savings account.
  • The bank pays you.
  • A higher interest is obtainable from reward for savings.
48
Q

(1)

What is a strong pound?

A

Where a pound is worth MORE in ANOTHER CURRENCY.

49
Q

(3)

Explain why a small business would import its goods.

A
  • Imports are cheaper.
  • Bringing the goods from abroad.
  • Results in Strong Pound.
50
Q

Discuss the impact on a small business from the introduction of new employment
laws.

A
  • Increased cost for training employees.
  • Training sessions must be held.
  • Costs money for employees’ training fees.
  • Once trained, cost of wages may increase.
  • Increases wages for National Minimum Wage and National Living Wage.
  • Employees may require higher pay.

GCSE Business: Theme 1 Flashcards (6 decks)

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