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Business Management > Yr11 Jacaranda Book > Flashcards

Yr11 Jacaranda Book Flashcards

1
Q

Chapter 1

Define business

A

Any activity that is conducted by an individual or individuals to produce and sell goods and services that satisfy the needs of society, as well as making profit

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2
Q

Chapter 1

Define profit

A

What is left after business expenses have been deducted from money earned from revenue

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3
Q

Chapter 1

What factors can you use to classify businesses

A
  • Size
  • Sector
  • Business activity
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4
Q

Chapter 1

What measurements can be used to determine the size of a business?

A
  1. Number of employees
  2. Number of owners
  3. Legal structure
  4. Amount of revenue earned
  5. Amount of assets owned
  6. Market share
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5
Q

Chapter 1

What does ABS stand for?

A

Australian Bureau of Statistics

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6
Q

Chapter 1

What is a business that has no employees called?
(Owner solely operates the business)

A

Non-employing business

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7
Q

Chapter 1

What is the number of employees that determines a small business as per ABS definition?

A

20 or less employees

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8
Q

Chapter 1

What is the number of employees that determines a medium business as per ABS definition?

A

20-200 employees

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9
Q

Chapter 1

What is the number of employees that determines a large business as per ABS definition?

A

More than 200 employees

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10
Q

Chapter 1

Compare the number of owners in small, medium and large businesses

A

In most cases, if a business is a sole trader, it is likely to be small. Medium and large businesses tend to be companies with many owners (or shareholders)

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11
Q

Chapter 1

Define shareholder

A

The owners of a company who are entitled to a share of its profits

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12
Q

Chapter 1

What does ATO stand for?

A

Australian Taxation Office

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13
Q

Chapter 1

How does the ATO define and allocate business sizes?

A

The ATO defines a small business as one that has less than $10 million in annual turnover (money received from sales). Large businesses are defined as those with turnover levels above $250 million. Medium businesses have an annual turnover within that range.

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14
Q

Chapter 1

Define revenue

A

The income that a business earns from the sale of goods and services to customers

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15
Q

Chapter 1

How does the ABS define a large business?

A

The ABS has historically defined a large business as one that has assets worth more than $200 million

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16
Q

Chapter 1

Define assets

A

Items of value owned by a business

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17
Q

Chapter 1

Define market share

A

The proportion of total sales in a given market or industry that is controlled or held by a business, calculated for a specific period of time

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18
Q

Chapter 1

List 3 examples of a small business, medium-sized business and large business.

A

Small:
- Corner store
- Local mechanic
- Hairdressing salon
Medium-sized:
- Services club
- Motel/hotel
- Engineering factory
Large:
- Woolworths
- Qantas
- National Australian Bank

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19
Q

Chapter 1

What is the type of ownership of a small business?

A

Independently owned and operated by one or two people

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20
Q

Chapter 1

What is the type of ownership of a medium-sized business?

A

Owned and operated by a few people and/or private shareholders

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21
Q

Chapter 1

What is the type of ownership of a large business?

A

Owned usually by thousands of public shareholders

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22
Q

Chapter 1

What are the common legal structures of a small business?

A
  • Sole trader
  • Partnership
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23
Q

Chapter 1

What are the most common legal structures of a medium-sized business?

A
  • Partnership
  • Private company
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24
Q

Chapter 1

What are the most common types of legal structures of a large business?

A
  • Public company
  • Private company (numerous)
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25
Q

Chapter 1

Who is responsible for decision-making in a small business?

A

Owner responsible for majority of decisions; simple and quick implementation of decisions

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26
Q

Chapter 1

Describe decision-making in a medium-sized business

A

Owner basically responsible for majority of decisions; more complicated decision-making with slower implementation, due to influence of directors

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27
Q

Chapter 1

Describe decision-making in a large business

A

Complex decision-making, due to division of responsibilities among directors, senior and middle management; possibly slow implementation of decisions, due to layers of management

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28
Q

Chapter 1

Describe the sources of finance of a small business

A

Owner (usually from savings or a loan); difficulty in accessing loans

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29
Q

Chapter 1

Describe the sources of finance of a medium-sized business

A

Owners’/partners’ own savings or a loan and/or private shareholders; easier accessibility to larger loans

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30
Q

Chapter 1

Describe the sources of finance of a large business

A

Many sources, including cash reserves, retained profit, sales of shares, and loans from domestic and overseas institutions

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31
Q

Chapter 1

Describe the market share of a small business

A

Small, usually local area; not dominant in the industry

32
Q

Chapter 1

Describe the market share of a medium-sized business

A

Medium-sized, due to dominance within a geographic region; some market dominance

33
Q

Chapter 1

Describe the market share of a large business

A

Large, especially for multinational corporations that dominate the markets of many countries

34
Q

Chapter 1

What is the private sector?

A

It is the part of Australia’s economy that is operated by private individuals and companies usually for the purpose of making profit. Businesses such as sole traders, partnerships and companies make up the private sector.

35
Q

Chapter 1

What is the public sector?

A

It is the part of Australia’s economy that is operated by the government. Businesses operating in the public sector are the least common type of business, and are referred to as government business enterprise (GBEs) as they are owned and operated by the government

36
Q

Chapter 1

Define industry

A

The classification of groups of businesses related to the particular good or service they produce

37
Q

Chapter 1

Identify and describe the three types of industries based on business activity

A

Primary industry: industries concerned with extracting resources directly from nature (e.g. farming, mining, forestry)

Secondary industry: where raw materials are turned into finished or semi-finished products. They take raw materials from primary industries and add value to them, by processing or manufacturing materials, or through assembly and construction

Tertiary industry: involves the provision of services (e.g. wholesaling, retailing and transport). It can be also divided into quaternary sector (involves the provision of information in areas such as the media, computing, finance, property and education, and the quinary sector, which involves paid and voluntary domestic services)

38
Q

Chapter 1

Define business opportunity

A

A set of circumstances that presents itself as an avenue to success

39
Q

Chapter 1

State some examples of opportunities to starting a business

A
  • Ideas for new products
  • New costumers
  • New ways of running businesses
40
Q

Chapter 1

What are some sources of opportunities for business ideas

A
  • Innovation
  • Entrepreneurship
  • Recognising and taking advantage of market opportunities
  • Changing customer needs
  • Research and development
  • Technological development
  • Global markets
41
Q

Chapter 1

Define innovation

A

Either creating a new good, service or process, or significantly improving an existing one

42
Q

Chapter 1

Define entrepreneurship

A

The ability or willingness to start, operate and assume the risk of a business venture in the hope of making a profit

43
Q

Chapter 1

Define markets

A

The places where buyers and sellers interact to trade goods and services

44
Q

Chapter 1

True or false: Markets are constantly changing

A

True. This provides market opportunities to potential business owners

45
Q

Chapter 1

Identify reasons that could change the needs of the customers in the market

A
  • changing incomes
  • changing tastes and fashion
  • changing process of complementary and substitute goods and services
  • changing population
  • changing expectations about the market, including future prices and incomes
  • changes in the number of potential customers
46
Q

Chapter 1

Define technological development

A

It refers to applications of knowledge that have changed people’s lives and changed the way in which businesses operate

47
Q

Chapter 1

Define research and development (R&D)

A

A set of activities undertaken to improve existing products, create new products and improve production processes

48
Q

Chapter 1

State some advantages of global markets

A
  • The opportunity to grow and further expand a business
  • reduced dependence on local markets
  • extended life cycle of new and existing products through the discovery of new markets to sell them in
  • reduced effects of fluctuations in markets caused by changes in season or demand by moving into markets with different patterns
49
Q

Chapter 1

Identify some common reasons to start a business

A
  • The desire for independence
  • to make profit
  • to fulfil a market need
  • to fulfil a social need
50
Q

Chapter 1

What are some examples of typical social needs?

A
  • providing opportunities for local unemployed people
  • developing skills, providing vocational training or lifelong learning opportunities for disadvantaged people in the community
  • creating access to a better quality of life for disadvantaged members of the community
  • focusing on waste minimisation and recycling
51
Q

Chapter 1

Define goal

A

What a business expects to achieve over a set period of time

52
Q

Chapter 1

Define vision statement

A

Describes where the business wants to be in the future (e.g. five years from now)

53
Q

Chapter 1

Define mission statement

A

Describes what the business does and how it will achieve its vision

54
Q

Chapter 1

Define a SMART goal

A

Specific — clear and focused
Measurable — quantifiable
Attainable — challenging but realistic
Relevant — based on current conditions
Time bound — deadline/time limit

55
Q

Chapter 1

What are the three types of goals?

A
  • financial goals
  • social goals
  • personal goals
56
Q

Chapter 1

State examples of financial goals

A
  • making a profit
  • increase sales
  • increase market share
  • expand the business
  • maximising the return on investment
  • improving the way that the business operates
57
Q

Chapter 1

Define return on investment

A

A positive or negative percentage that relates the money gained or lost on an investment to the cost of the investment. It is usually taken to mean that the return on the investment occurs over a 12-month period.

58
Q

Chapter 1

Define productivity

A

A measure of business efficiency comparing output produced with the quantity of inputs. It is calculated using the formula: Productivity =outputs/inputs

59
Q

Chapter 1

Define efficiency

A

A measure of how well we do things; for example, if we are able to produce more outputs from the same inputs, we have become more efficient at using these inputs

60
Q

Chapter 1

Define effectiveness

A

A measure of whether the business s doing the right things — those that are most important to the success of the business

61
Q

Chapter 1

State examples of social goals

A
  • community service
  • provision of employment
  • social justice
  • ecological sustainability
62
Q

Chapter 1

True/false: personal goals are publicly distributed

A

False. They are often private.

63
Q

Chapter 1

Define entrepreneur

A

A person who is willing to seize opportunities to start and operate a business, and is prepared to take risks in hope of making a profit

64
Q

Chapter 1

List some common characteristics of entrepreneurs

A
  • have a shared vision
  • take initiative
  • innovation and enterprise
65
Q

Chapter 1

Describe some independent sources of a business concept

A

The source of a business concept may come from a person’s own:

  • experiences
  • interests
  • abilities
  • imagination
66
Q

Chapter 1

Where can inspiration for business concept ideas originate from?

A
  • listening to people, especially for ideas on the goods and services people want, but that may not be readily available
  • reading magazines and books and researching on the internet
  • visiting displays and exhibitions in areas such as new technology or new products from overseas
  • accessing government statistics and research information
  • identifying a ‘gap in the market’ — that is, a demand not currently being satisfied
  • determining improvements that could be made to an existing product
67
Q

Chapter 1

What is an intellectual property (IP)?

A

IP is any creation of the mind such as a new invention, a brand, a design or artistic creation.
These creations can have a commercial value, or provide a competitive advantage, for a person or business, so it is crucial to ensure competitors do not copy them.

68
Q

Chapter 1

What are the five common methods of protecting IP?

A
  • Trademark
  • Patents
  • Copyright
  • Design rights
  • Domain name
69
Q

Chapter 1

What is a trademark granted over?

A

Word
Letter
Phrase
Number
Sounds
Smell
Shape
Logo
Picture
Aspect of packaging used to represent its products and services

70
Q

Chapter 1

What is a patent granted over?

A

Device
Substance
Method
Process

71
Q

Chapter 1

Define market research

A

A process of systematically collecting, recording and analysing information concerning a specific market

72
Q

Chapter 1

What are the steps involved in market reasearch?

A
  1. Identifying what information is needed to make a decision about a potential business
  2. Gathering relevant information from appropriate sources (e.g. surveys, interviews or examining government statistics)
  3. Analysing and interpreting the relevant results to extract some clear information that will assist in decision making
73
Q

Define feasibility study

A

An assessment of the practicality and potential for success of a proposed business idea

74
Q

What is included in the feasibility study?

A
  • an assessment of the market
  • a consideration of the operations
  • an analysis of commercial feasibility
  • an appraisal of the potential owner’s management ability
  • an understanding of whether others have tried this idea
75
Q

Define economy

A

A system set up to determine what to produce, how to produce and to whom production will be distributed

Business Management (3 decks)

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