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A level business > what is a business? > Flashcards

what is a business? Flashcards

1
Q

What is a Business?

A

An organization that provides goods or services to customers in exchange for money.

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2
Q

What are Goods?

A

Physical, tangible products like cars, books, or food.

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3
Q

What are Services?

A

Intangible products such as banking, teaching, or cleaning.

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4
Q

What is the Primary Purpose of a Business?

A

To satisfy customer needs and make a profit.

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4
Q

What are the Main Types of Business Organizations?

A

Sole trader, partnership, private limited company (Ltd), and public limited company (Plc).

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5
Q

What is Profit?

A

The financial gain made when total revenue exceeds total costs.

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6
Q

What are the Advantages of Being a Sole Trader?

A

Easy to set up, full control, and keeps all profits.

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6
Q

What is a Sole Trader?

A

A business owned and run by one person.

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7
Q

What are the Benefits of a Partnership?

A

Shared decision-making and more capital available.

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7
Q

What is a Partnership?

A

A business owned by two or more people who share responsibility.

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7
Q

What are the Disadvantages of Being a Sole Trader?

A

Unlimited liability and harder to raise capital.

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8
Q

What is a Private Limited Company (Ltd)?

A

A business owned by shareholders with limited liability, but shares are not publicly traded.

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8
Q

What are the Drawbacks of a Partnership?

A

Unlimited liability and potential for disputes.

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9
Q

What is a Public Limited Company (Plc)?

A

A business whose shares are traded on the stock market and have limited liability.

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10
Q

What is the Difference Between Private and Public Sector Businesses?

A

Private sector businesses are owned by individuals or groups, while public sector businesses are owned by the government.

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11
Q

What is Limited Liability?

A

Shareholders are only responsible for the debts of the business up to the value of their shares.

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11
Q

What is Unlimited Liability?

A

The owner(s) are personally responsible for all the debts of the business.

12
Q

What are Business Objectives?

A

The specific goals or targets a business aims to achieve.

12
Q

What is a Common Objective for Many Businesses?

A

Maximizing profit, increasing market share, or growing sales.

13
Q

What is Corporate Social Responsibility (CSR)?

A

The idea that a business should be accountable for its impact on society and the environment.

14
Q

What are Stakeholders?

A

Individuals or groups that have an interest in the performance and activities of a business, like employees, customers, and suppliers.

15
Q

How is Revenue Calculated?

A

Revenue = Price per unit × Number of units sold.

16
Q

What is Revenue?

A

The total income a business earns from selling goods or services.

16
Q

What are Fixed Costs?

A

Costs that do not change with the level of output, like rent or salaries.

17
Q

What is Cash Flow?

A

The movement of money into and out of a business.

17
Q

What are Total Costs?

A

The sum of fixed and variable costs.

18
Q

What are Variable Costs?

A

Costs that change with the level of output, like raw materials or direct labor.

18
Q

What is the Formula for Profit?

A

Profit = Total Revenue - Total Costs.

19
Q

Why is Cash Flow Important?

A

It ensures a business can pay its bills and operate smoothly.

20
Q

What is a Mission Statement?

A

A short description of a business’s overall purpose and values.

21
Q

What is the Difference Between a Mission and a Vision Statement?

A

A mission statement describes the business’s purpose now, while a vision statement outlines its future aspirations.

21
Q

What is a Business Strategy?

A

A long-term plan to achieve business objectives.

22
Q

How is Market Share Calculated?

A

Market Share = (Sales of the Business / Total Market Sales) × 100.

22
Q

What is Market Share?

A

The percentage of total sales in a market controlled by one business.

23
Q

What is a Business Plan?

A

A document outlining a business’s goals and the strategies it will use to achieve them.

23
Q

Why is a Business Plan Important?

A

It helps secure investment and provides a roadmap for success.

24
Q

What is the Secondary Sector?

A

The part of the economy involved in manufacturing and construction.

24
Q

What is the Primary Sector?

A

The part of the economy that extracts and uses natural resources, like farming or mining.

25
Q

What is the Tertiary Sector?

A

The part of the economy that provides services, like retail or healthcare.

26
Q

What is Business Ethics?

A

Principles that guide the way a business behaves, focusing on what is morally right or wrong.

A level business (2 decks)

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