unit one Flashcards
what are the 4 factors of production?
land, labour, capital, enterprise
an example for each of the 4 factors of production?
a office block, or a farm would be land.
labour would be the work force you have.
capital is anything to do with money, for example the machineary you have.
enterprise is the thing that brings them all together.
why is business location important?
its important becuase you need to be close to the target market.
its also important because you need to be accessable to the what you are selling or you need to be able to send your stuff to be sold.
what should a business plan contain?
the business costs,
the recources needed,
the workers,
target market,
profit forecast,
business objecives,
business aims.
why are business plans important?
business plans are important because they focus the business aproach and mean that everyone knows what they are meant to be doing.
what are the two types of costs?
variable costs, these change depending on how well the business does e.g. staff bonuses
fixed costs, these dont change no matter how well the business does e.g. rent
what is non operating revenue?
The revenue from anything that is not your sale an example of this is investments.
what is operating revenue?
the revenue you get from sales
examples of variable costs
how much you order from your supplier
how many staff you take on
how much bonus you give to your staff
tax
example of fixed costs
rent
how to work out total revenue?
oporating revenue + non operating revenue
characteristics of an entrepreneur
Innovative
Risk taker
Hard worker
Organised
Determined
Persuasive
Leadership
Lucky
what is an entrepreneur?
an entrepreneur is someone who takes a calculated risk by starting a business
why would someone chose to start a business?
to make money,
to turn a hobby into a business
what does GDP stand for
Gross Domestic Product
Whats the diffrence between a good and a service
a good is something tangible where a service is an action which is non tangible.
what is a service
a service is where you pay for the skills of somebody and its non tangible
what is a good
a good is a tangible object you buy
what are the three business sectors
Primary
Secondary
Tertiary
What is done in the Primary sector
The primary sector is where raw materials are harvested, for example farming or a coal mine
What is done in the secondary sector
The Secondary sector is where goods are manafactured or goods are bought and sold
What is the Tertiary sector
The Tertiary sector is where a service is provided, E.G. banks ,teachers, docotors
what is the public sector?
Public secotor – controlled by the government E.G state schools, hospitals and libraries (TAX run)
what is the private sector?
private secotor – aim to make a profit, from small local businesses to large businesses.
What is an LTD?
a LTD stands for private limted company this means only people allowed by the owner can buy shares and when someone wants to sell shares they have to sell them back to the owner.
What is a PLC?
a PLC is a public limeted comapny and it means anyone who wants to buy shares can. owner has no control on who buys the shares
what does Limited liability mean?
limited liability means that if the business gets in debt they cant make up that debt buy getting money from the share holders.
what does unlimited liability mean?
unlimited liabilty means that if a company gets into debt they might go after the owners possesions to make up for the debt.
what are the different types of Business ownerships
Private ltd company
Public ltd company.
Sole trader
Partnerships
What is a sole trader
a sole trader is a single person going into business, its unlimited liability so its risky.
what is a partnership
a partnership is a group of people between 2 - 20 people and its unlimited liability.
reasons for starting a partnership, is because you want to get other skilled people on your business.
What are the diffrent ways of aquiring a business
merger and take over,
you have a normal take over
and a hostile takeover
also a joint venture
What is a hostile take over
a hostile take over is where a company sells to another company not cuase they want to but cause they need to
this may happen cause one under cuts another company taking the customers and driving the other companies prices lower and drives one of the companies out of business
what is a joint venture
a joint venture is when two comapnies work together or combine as a new to go into a new market.
what is franchising
when you let other people open branches to carry the brand and sell products, you don’t own the branches, but they pay you a yearly fee and % of profit
what are the ways of measuring growth
market share,
market capitalisation,
company size (how many employees)
