Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

A-level Business > Unit 7 > Flashcards

Unit 7 Flashcards

1
Q

Define short termism

A
  • Pressure on a business to perform in the short term,
  • May be at the cost of long term growth
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Give internal influences on corporate objectives and decisions

A

Mission statement​

Leaders’ personal objectives and values​

Performance​

Organisational culture​

Internal stakeholders​

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

Give external influences on corporate objectives and decisions

A

External environment – PESTEL​

Investors’ objectives​

Competitive environment​

Global markets​

External stakeholders

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

What does strategic decisions on functional decisions

A
  • Marketing​:
    Research into new markets​
    Product development​
  • Finance​
    Raising finance to support growth​
    Proportion of long term funding that is debt​
  • Operations​
    Relocating production abroad​
    Outsourcing​
  • Human resources​
    Delayering or rationalisation​
    Core or peripheral workers
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

How does SWOT analysis help inform decision making

A

Structured approach to analysing a business​

Considers both internal and external issues​

Includes both qualitative and quantitative factors​

Can look to: ​
maximise strengths​
minimise weaknesses​
take advantage of opportunities​
avoid threats

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What are the ratio analysis

A
  • Return on capital employed
  • Liquidity (Current ratio)
  • Gearing
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What are the efficiency ratios

A
  • Payable days
  • Recievable days
  • Inventory turnover
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Formula for inventory turnover

A

Cost of sales / Average inventory held

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

Value of financial ratios

A

Provides a tool for the interpretation of accounts​

Structure from which comparisons can be made:​
Overtime​
With other businesses​

Aids decision making​:
Internally​
Externally by investors

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

Limitation of financial ratios

A

Possibility that accounts have been window dressed​

Need to consider reasons behind ratios​
e.g. is ROCE lower than previous years because of an investment programme​

Quantitative information only

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

What are the operations data

A
  • Capacity
  • Capacity utilisation
  • Labour productivity
  • Unit costs (average costs)
  • Quality
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What are the ways you can analyse data

A
  • Over time
  • In comparison
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Give the analysis of core competences

A

Combined expertise, knowledge and experience of the leaders and founders of a business​

Collective learning and technical expertise​

Leads to a competitive advantage​

Unique characteristics to a business​

Difficult to imitate by others

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What are the main areas of Kaplan and Norton’s Balanced Scorecard

A

Finance: Measuring financial capability e.g. financial ratio analysis​

Internal business processes: Efficiency in the organisation e.g. JIT and capacity utilisation​

Learning and growth: HR requirements e.g. training, labour turnover/productivity and communication​

Customer: Expectations being met e.g. customer service, satisfaction and retention

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What does Elkington’s triple bottom line

A
  • A model designed to encourage sustainability​
  • Focus is on 3 key components to measure performance​:

Profit​
People​
Planet​

  • Forces a business to consider its social responsibility
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What does the competition policy improves

A

the competitive nature of markets ​

It seeks to alleviate market failure in order to protect the interests of consumers and society as a whole​

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

What is Market power

A

the ability of a business to set price above those that would be charged if there were competition​

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

What are the benefits that lead to competition policy being successful

A
  • Lower price
  • Improved quality
  • Increased choice
  • Innovation
  • Competitive advantage
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Give a list of the individual labour laws

A

Equal Pay Act – both sexes should be treated equally at work​

Sex Discrimination Act – this outlawed discrimination based on gender for recruitment, promotion, training or dismissal​

Race Relations Act – illegal to discriminate based on colour​

Disability Discrimination Act – illegal to discriminate against disabled people and made provision to assist the employment of disabled people​

Working Time Regulations – employees cannot be forced to work more than 48 hours a week​

National Minimum Wage Act – a minimum hourly wage rate introduced across the UK

Employment Act – ‘Secondary picketing’ outlawed​

Trade Union Act – a secret ballot required before strike action​

Employment Act – outlawed closed shops (where all workers belong to a single union)​

Trade Union Reform Act – unions must give employees at least 7 days notice of industrial action​

Employment Relations Act – right to recognition of a union in the workplace if 50% belong to a union

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Laws that relate to the labour maket

A
  • Wage discrimination
  • Discrimination
  • Labour market reforms
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

What is the act that links with minimum wage

A

National Minimum Wage Act 1998

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Give arguments for living wage

A

Encourages people to supply labour​

Reduces inequalities​

Reduces welfare burden​

Increases demand in the economy​

Improves standards of livin

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Arguments against living wage

A

May create unemployment​

Interferes with the workings of the market ​

Reduces UK competitiveness​

Lowers supply of goods and services as workers become too expensive, increasing business costs

24
Q

What are the different acts that relate to environment

A
  • Environmental Protection Act ​

Businesses must improve the control of pollution arising from industrial and other processes​

  • Environment Act​

A business must clean up any contaminated sites that it owns​

The Act also established the Environment Agency in order to oversee environmental protection ​

25
The 4 factors of production
- Land - Labour - Capital - Entrepreneurial skill
26
How can entrepreneurs impact a business
Create competition​ Supply goods and services​ Offer specialisms and expertise​ Buy goods and service
27
How can entrepreneurs impact the economy
Provide employment​ Pay taxes​ Social benefits
28
What is privatisation
leads to monopoly power as most firms privatised operate in markets with barriers to entry such as economies of large scale​
29
Define De-regulation
the opening up of markets to new competition through the removal of rules and regulations that created barriers to entry
30
Define Real GDP
takes into account inflation. If GDP growth is 5% and inflation 2% real GDP growth will be 3%​
31
2 types of tax
Direct taxes are taxes imposed on an individual or property e.g. income taxes, corporation tax, national insurance, stamp duty​ Indirect taxes are taxes on a transaction and imposed on a producer e.g. VAT, duties, air passenger duty​ ​
32
2 types of measurements of Inflation
Retail Price Index (RPI) – a measurement of a ‘basket’ of goods and services representative of what people buy in the UK​ Consumer Price Index (CPI) – similar to RPI but mainly excluding housing costs​
33
Define fiscal policy
the manipulation of government spending, taxation and government borrowing to influence the level of economic activity.
34
2 types of fiscal policies
- Expansionary - Contradictory
35
What is a Expansionary fiscal policy
- Government is trying to positively stimulate economic activity - Cutting taxes - Raising government spending - Increase the budget deficit
36
What is a Contradictory fiscal policy
- government is trying to constrain demand, reduce debt or control inflation - Increasing taxes - Cutting government spending - Cutting the budget deficit
37
What is a Monetary policy
- the manipulation of the rate of interest, the money supply and exchange rates to influence the level of economic activity.​ ​Monetary policy in the UK has been delegated to the Bank of England (BoE), who have responsibility for setting interest rates (also known as the base rate) and controlling the money supply​
38
2 Monetary policy tools
- The money supply, This is where BoE adds a supply of notes and coins in the economy - Quantitative Easing, Cutting spending
39
Benefits of open trade
Specialisation leading to more efficient use of resources​ Increased competition encouraging greater efficiency​ Encourages and rewards innovation​ Provides markets for surplus raw materials​ Job creation in imports and exports​ Economic growth​ Consumer choice​ Greater respect for other countries customs and cultures​
40
Define protectionism
to policies imposed by governments to restrict the free movement of goods and services between countries. ​
41
How can a government use protectionism
- Tarrifs, taxes on goods - Quotas, Limits the amount of exports and imports - Embargo, A ban on the import or export of a particular good - Regulations, Enforce standards that are need to be med before trade is allowed
42
Define golbalisation
- the integration of international economies leading to a world market in goods and services.
43
Reasons for greater globalisations
Opportunities to sell into new markets​ Economies of scale and scope as the business grows globally​ Global marketing strategies can be used​ Cheaper raw materials from low cost countries​ Cheaper labour costs abroad​ Free movement of labour providing cheap labour in the UK​ Off-shoring provides greater opportunities for optimal location
44
Disadvantage of globalisation
Increased competition – although this can make businesses more efficient​ ‘Global localisation’ – altering products to meet local tastes - may be required to meet local cultures​ Communication and transport problems​ Businesses can gain a bad reputation for making UK workers redundant​ Exploitation of foreign workers can lead to criticism of being unethical​ Exploitation of the global environment can lead to bad publicity
45
Characteristics of globalisation
- Increased investment flows - World trade rising as a proportion of world Gross Domestic Product (GDP) - Increased migration
46
Importance of globalization for business
- Trade liberalisation​ The World Trade Organisation (WTO) has assisted in the reduction or removal of trade barriers and there has been a greater proliferation of trade agreements across the world​ - Capital market liberalisation
47
Reasons against CSR
- Financial costs - Not meeting corporate objectives - Opportunity cost
48
What is Carroll's Corporate Social Responsibility sections
- A theory that highlights the four aspects of corporate social responsibility. Society expects businesses to meet their obligations in relation to all four aspects. - Economic responsibility - Legal responsibilities - Ethical responsibilities - Philanthropic responsibilities
49
What are the sections of Porter's five forces
- Buyer power - Substitute threat - Supplier power - Entry threat (barriers to entry) - Rivalry
50
What are the different competitive rivalry
- Monopoly – one business dominates the market​ - Duopoly – two businesses dominate the market​ Oligopoly – a small number of businesses are in the industry ​ Monopolistic Competition – many businesses compete in the industry selling differentiated products​ Perfect competition – many businesses in the industry with no influence on market price
51
What are the 3 investment apprisal
- Payback - Average rate of return - Net present values
52
How to calculate average rate of return
- Calculate average annual profit: Total net cash flow / number of years Divide average annual profit by initial investment * 100
53
Define sensitivity analysis
-the process of systematically changing variables to calculate a range of possible financial outcomes
54
Examples of changing variables
Expected cash inflows​ Expected cash outflows​ Discount factor​ Number of years profit
55

A-level Business (8 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions