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Business Paper 1 > Unit 1 - What Is Business > Flashcards

Unit 1 - What Is Business Flashcards

1
Q

What is the transformation process?

A

Inputs–> transformation process –>output

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2
Q

What are the 4 business sectors?

A

Primary
Secondary
Tertiary
Quaternary

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3
Q

What is primary and secondary market research?

A

Primary- extraction of natural resources
Secondary - production of natural resources to goods

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4
Q

What is tertiary and quaternary business sector?

A

Tertiary - providing the goods and services
Quaternary - providing information and ICT

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5
Q

What is adding value?

A

The process of creating value by transforming inputs into outputs

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6
Q

What does unincorporated mean?

A
  • unlimited liability
  • no legal difference
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7
Q

What is incorporated?

A
  • limited liability
  • seperate legal identity
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8
Q

What is a sole trader?

A

Someone who trades by themselves and has unlimited liability

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9
Q

What is a private limited company?

A
  • Has limited liability
  • sell shares to friends and family only
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10
Q

What is a public limited company?

A
  • had limited liability
  • public can buy shares
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11
Q

What are advantages of a sole trader?

A

Quick and easy
Simple to run
Minimal paperwork

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12
Q

What are disadvantages to a sole trader?

A

Unlimited liability
Harder to raise finance
Higher tax rate

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13
Q

What are advantages to a private limited company?

A
  • limited liability
  • easy to raise finance
  • stable structure form
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14
Q

What are disadvantages to a private limited company?

A
  • greater admin costs
  • public disclosure of info
  • legal duties
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15
Q

What is pestle?

A

Political
Economic
Social
Technological
Legal
Ethical/environmental

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16
Q

What are dividends?

A

Payments made to shareholders by the company from earned profits

17
Q

What is the equation for market capitalisation?

A

Share price × number of issued shares

18
Q

What is market capitalisation?

A

The total market value of issued share capital of a business

19
Q

Define flotation

A

The admission of shares of a public company to a stock exchange and trading

20
Q

What does B2C and B2B stand for?

A

B2C - business to customer
B2B - business to business

21
Q

What is a mission statement?

A

Sets out what an organisation is trying to achieve. The reason it exists

22
Q

What does SMART stand for?

A

Specific
Measurable
Achievable
Realistic
Time bound

23
Q

What is GDP?

A

Measures the value of a countries total output of goods and services over a period of time.

24
Q

Name 6 business objectives

A

Profit
Growth
Survival
Cash flow
Social
Ethical

25
Q

What is a franchise?

A

When a business sells their name to others for them to trade under

26
Q

What is a mutual?

A

When their are no owners and are for the benefits of the members

27
Q

What is capital gain?

A

When a business increases in value

28
Q

In the external environment, what does MIIDEF stand for?

A

Market conditions + competition
Incomes
Interest rates
Demographic factor
Environment
Fair trade

Business Paper 1 (6 decks)

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