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Business BTEC Level 3 > Unit 3 > Flashcards

Unit 3 Flashcards

1
Q

Advantages of Car insurance

A

No claims bonus

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2
Q

What are the types of online customer communication

A

Online banking

Pawn brokers

Telephone banking

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3
Q

More types of financial organisations

A

Insurance Companies

Pawn brokers

Pension companies

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4
Q

What are the types of financial organisations?

A

Bank of England

Banks

Credit unions

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5
Q

Definition: insurance

A

Insurance is a financial service that protects an individual

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6
Q

Yes or no, do premium bonds pay interest

A

No.

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7
Q

What does a fixed deposit do?

A

Pays a fixed amount for a period of time

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8
Q

What are the types of current accounts?

A

Student account

Packaged account

Basic account

Standard account

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9
Q

Main types of borrowing

A

Credit card

Loan

Mortgage

Overdraft

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10
Q

Advantage of an overdraft

A

Easy to set up

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11
Q

Disadvantages of an overdraft

A

High interest rates

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12
Q

Disadvantage of an overdraft (2)

A

High interest rates

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13
Q

Advantages of a personal loan

A

Monthly installments

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14
Q

Disadvantages of a personal loan

A

Arrangement fees

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15
Q

Advantage of a mortgage

A

Purchase for a long period of time.

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16
Q

Disadvantages of Mortgage

A

Items may be repossessed

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17
Q

What is the financial ombudsman service

A

Is an independent body that resolves disputes between customers and institutions

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18
Q

What is the financial conduct authority

A

Regulates the conduct of financial service providers

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19
Q

Definition: inflation

A

Inflation is when the prices of food rise due to the decrease in the value of money.

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20
Q

What are the functions of money

A

Units of account

Means of exchange

Store of value

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21
Q

Factors influencing the view of money

A

High interest rates

Culture

Life events

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22
Q

Why do we plan expenditure

A

To generate income

Avoid bankruptcy

Control costs

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23
Q

What are the most common payment methods?

A

Credit card

Debit card

Cash

Cheque

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24
Q

What are the two main types of ISA?
(Individual Savings Account)

A

Cash ISA

Stocks/shares ISA

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25
Q

What is credit rating?

A

Score that tells you how much money you have been paying overtime.

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26
Q

What is bankruptcy

A

Where you have no money left due to unpaid loans and debts

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27
Q

What is debt?

A

How much money you own off from a loan

28
Q

What are interest rates?

A

Rate of borrowing money or the reward of Saving it

29
Q

Disadvantage of pet insurance

A

Vaccinations are not covered

30
Q

Disadvantages of health insurance

A

Pre existing medical records are not covered

31
Q

Advantages of health insurance

A

Covers the entire medical costs

32
Q

Disadvantages of car insurance

A

Costly

Expensive

33
Q

Advantages of pet insurance

A

Cover The Cost

34
Q

Disadvantage of home insurance

A

Only covers the rebuilding of the property.

35
Q

Advantages of home insurance

A

Covers the cost.

36
Q

What is an Overdraft?

A

Allows Bank holders to withdraw more money than they have

37
Q

What is an Individual Savings Account?

A

Savings where the owner is not charged on income

38
Q

Disadvantage of Credit Cards

A

High Interest Rates

Lead to high amounts of debt

39
Q

Disadvantage of Debit Cards

A

Limited fraud Protection

Overspending

40
Q

Advantage of Debit Card

A

Easy to use

Low Interest rates

41
Q

Advantage of a Credit Card

A

Avoids Overspending

Most common payment method

42
Q

What is crowdfunding

A

A way of raising money to finance business events

43
Q

What is a shareholder

A

Someone who has an interest in a business in return for an equity

44
Q

What is expenditure

A

The amount of money to cover all expenses

45
Q

Advantage of life insurance

A

Peace of Mind

46
Q

Disadvantage of Life insurance

A

Costly

Expensive

47
Q

Advantage of Travel insurance

A

Covers Medical Cost

48
Q

Disadvantage of Travel Insurance

A

Limited Coverage

49
Q

What are the types of revenue Income?

A

Credit Sales

Cash Sales

Interest received

50
Q

What are the types of capital income?

A

Mortgage

Loan

Shares

51
Q

What are the purposes of accounting?

A

Compliance

Recording Transactions

Control

52
Q

What is consumer protection?

A

laws and regulations that protect customers from being treated unfairly

53
Q

What is a consumer credit legislation?

A

is a rule that a financial provider has to follow

54
Q

What are the types of revenue expenditure

A

Rent
Insurances
Wages
Interest paid

55
Q

What are the internal sources of finance?

A

Sale of assets

Retained profit

Net current assets

56
Q

What are the external sources of finance?

A

Loans

Crowdfunding

Hire purchase

57
Q

What is HMRC?

A

HMRC is the tax authority of the United Kingdom

58
Q

What are the type of current assets

A

inventories

trade receivables

prepayments

59
Q

Advantage of Net Current Assets

A

Effective Cash Flow

60
Q

Disadvantages of Net Current Assets

A

Pressure on customers

61
Q

Advantage of Crowdfunding

A

High exposure

Access to Capital

62
Q

Disadvantage of Crowdfunding

A

Costly

Loss of reputation

63
Q

What are inflows and outflows

A

Inflows = money coming into the business

Outflows = money coming out of the business

64
Q

What is cash flow

A

Movement of money throughout the business

65
Q

What is Liquidity

A

Firms ability to meet short-term payments

66
Q

What is credit period

A

Length of time given to customers to pay goods

67
Q

What is insolvent

A

When a firm is unable to meet short-term payments

Business BTEC Level 3 (4 decks)

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