year 11 midterm test Flashcards
delete once done
what is the primary sector
resources extracted from earth
what is the secondary sector
manufacturing goods
what is the tertiary sector
retail and services
what is the quaternary sector
e-commerce, interact online
what are the four sectors of industry
-primary, secondary, tertiary, quatenary
why has manufacturing declined in developed countries and service grown?
-manufacturing has grown in less developed countries due to cheaper labour costs
-developed countries have concentrated on selling those goods, growing the tertiary sector
-pandemic caused a growth in the quaternary sector
vertical intergration
- different sectors merging, e.g. sceondary and primary
horizontal integration
- 2 shops in the same sector merging
what is globalisation
intercation and mutual benefit of the trade between countries across the world
reasons for globalisation
-trade liberisation
-political change
-reduced cost of transport and communications
-increased significance of global companies
-cheap labour in other countries
-increased investment flows (FDI)
how has FDI led to globalisation
-business outside an important market trading blocs will invest in a business or set up production inside trading blocs to avoid tariffs
businesses impact of FDI on business
negative:
-damaging effect on local business, competition and possible loss for domestic rivals
postive:
-generate income for the country with a MNC, use income for local schools ect. can invest income into country, esp beneficial for ELDCs
why might countries impose trade barriers
to support local businesses
MNC
company that has headquaters and multiple branches in 2 or more countries
why have multinational companies developed
-economies of scale, reducing costs by buying items in bulk, reduced cost per item
-marketing
-technical and financial superioty- can borrow more money from the bank
benefits of an NMC
-much larger customer base
-lower costs
-higher company profile
-avoiding trade barriers
-lower taxes, production in a country that has little to no tax
invisible trade
services, e.g. tourism
visible trade
tangible products
if the pound is weaker compared to USA
-price of exports fall, and demand for exports rise
-price of imports rise, and demand for imports fall
-weaker pound: 1GBP= 2 USD
-export: 500 GBP of goods sold to a business in USA cost 1000 USD
-import: US to UK, weaker pound gets less for a pound
if exchange rate rises
-price of exports rise, and demand for exports fall
-price of imports fall and demand for imports rise
how are large and small businesses likely to be affected by exchange rates
-large businesses are more likely to be affected since the export more goods abroad, however small businesses may also be affected by exchange rate in the cost of resources.
factors that influence business location
-market
-labour
-raw materials
-competitors
-transport
how the nature of the business influence business location
-manufacturing,may require resources to be transported to their site and specialist facilities
-exporting, may need access to docks, rails or airports
-retailing, situated on a busy street or in a busy mall
-tourism, may need to be near popular tourist attractions such as beaches and famous landmarks
why might the nature of the business affect buisness location (sectors)
Businesses in the tertairy sector will require to be in city centres as they provide services that may require to be in locations convenient for customers. In the primary sectro, you location may be in rural area as land is cheap and you don’t need to be close to your customers.
why might businesses fail?
-cash flow problems
-poor management
-ineffective market research
-poor leadership skills
-business location
-ineffective organization of finance
-not competitive
-lack of security
-recession
advertising AD and DD
AD:
-can have a big impact and grab customers attention if the advert is in the right place and uses the right medium
DD:
-can be expensive and it can also be difficult to work out the impact of adveritising on sales
sponsorship AD and DD
AD:
-can provide businesses with a lot of exposure and associate it with a good cause
DD:
-communicates very little info about the details of the business
product trials AD and DD
AD:
-can encourage customers to use a new product or service that they might not try otherwise
DD:
- can be expensive to give away free products
speical offers AD and DD
AD:
-BOGOF, free prize draws and disocunt sales
DD:
-not sustainable in the long run as selling profucts discounted will reduce profits
public relations AD and DD
AD:
-can encourgae customers to connect with the brand and trust it and become loyal to it
DD:
-takes a long time to develop a strong brand amd brand image can be damaged quickly by bad publicity
technology in promotion
-social media, cheap
-cookies, targeted to particular consumers and market segments
-email, e-newsletters
-apps
