year 11 midterm test

Question 1

what is the primary sector

Answer 1

resources extracted from earth

Question 2

what is the secondary sector

Answer 2

manufacturing goods

Question 3

what is the tertiary sector

Answer 3

retail and services

Question 4

what is the quaternary sector

Answer 4

e-commerce, interact online

Question 5

what are the four sectors of industry

Answer 5

-primary, secondary, tertiary, quatenary

Question 6

why has manufacturing declined in developed countries and service grown?

Answer 6

-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

Question 7

vertical intergration

Answer 7

• different sectors merging, e.g. sceondary and primary

Question 8

horizontal integration

Answer 8

• 2 shops in the same sector merging

Question 9

what is globalisation

Answer 9

intercation and mutual benefit of the trade between countries across the world

Question 10

reasons for globalisation

Answer 10

-trade liberisation
-political change
-reduced cost of transport and communications
-increased significance of global companies
-cheap labour in other countries
-increased investment flows (FDI)

Question 11

how has FDI led to globalisation

Answer 11

-business outside an important market trading blocs will invest in a business or set up production inside trading blocs to avoid tariffs

Question 12

businesses impact of FDI on business

Answer 12

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

Question 13

why might countries impose trade barriers

Answer 13

to support local businesses

Question 14

MNC

Answer 14

company that has headquaters and multiple branches in 2 or more countries

Question 15

why have multinational companies developed

Answer 15

-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

Question 16

benefits of an NMC

Answer 16

-much larger customer base
-lower costs
-higher company profile
-avoiding trade barriers
-lower taxes, production in a country that has little to no tax

Question 17

invisible trade

Answer 17

services, e.g. tourism

Question 18

visible trade

Answer 18

tangible products

Question 19

if exchange rate rises

Answer 19

-price of exports fall, and demand for exports rise
-price of imports rise, and demand for imports fall

Question 20

if exchange rate rises

Answer 20

-price of exports rise, and demand for exports fall
-price of imports fall and demand for imports rise

Question 21

how are large and small businesses likely to be affected by exchange rates

Answer 21

-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.

Question 22

factors that influence business location

Answer 22

-market
-labour
-raw materials
-competitors
-transport

Question 23

how the nature of the business influence business location

Answer 23

-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

Question 24

why might the nature of the business affect buisness location (sectors)

Answer 24

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.

Question 25

why might businesses fail?

Answer 25

-A business may be unable to generate enough revenue to sustain its operations
-Costs may rise sharply and eliminate profit margins
-Cash shortages mean that creditors cannot be paid what they are owed
-Limited access to finance such as loans/trade credit can be particularly problematic for start-ups
-Lack of experience can lead to poor decisions related to product range, pricing or promotional activity
-Making decisions based on hunches rather than market research
-Ineffective coordination and planning of business operations, such as stock purchasing or staffing, can increase costs
-Ineffective or delayed response to new technology, powerful new competitors and major economic change
-Changes in laws or taxation can increase pressure on businesses to make difficult choices
This occurs when a business expands too quickly
-poor coordination and planning of growth can lead to diseconomies of scale which increases costs

Question 26

advertising AD and DD

Answer 26

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

Question 27

sponsorship AD and DD

Answer 27

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

Question 28

product trials AD and DD

Answer 28

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

Question 29

speical offers AD and DD

Answer 29

AD:
-BOGOF, free prize draws and disocunt sales
DD:
-not sustainable in the long run as selling profucts discounted will reduce profits

Question 30

public relations AD and DD

Answer 30

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

Question 31

technology in promotion

Answer 31

-social media, cheap
-cookies, targeted to particular consumers and market segments
-email, e-newsletters
-apps