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Flashcards

Edexcel business studies Unit 1

lewis001 Business GCSE English 42 cards

Cards in this deck (42)

  1. 1Name 4 Characteristics of a successful entrepreneur and a failed entrepreneurGood: Takes calculated risks, Creative, Innovative and Self-confident
  2. 2What are the 3 motives of an entrepreneur?Ethical, Profit, Non-profit
  3. 3What are the four leadership styles?Autocratic, Paternalistic, Laissez-faire and Democratic
  4. 4Explain McGregor's Theory X and Theory Y.x= blue collar workers, non-motivated requires more of an autocratic leadership style
    y= White collar workers, self-motivated requires more of a laissez faire management style
  5. 5Factors affecting demand: Price - price set by suppliers is crucial is the consumer equationquality over price = value for money
  6. 6Which factors affect demand?Tastes/ Preferences, Competitors price, State of the economy
  7. 7What does the Demand Curve allow?To work out the right price to sell a product/ service and to maximise profit.
  8. 8What is a Supply Curve?A chart which shows consumers willing to pay more cause supply to increase
  9. 9What changes demand?Population/Structure, FMCG, Disposable income, Complementary, Competitors prices
  10. 10What are the 2 types of primary research?Qualitative: Focused on consumers opinions, feelings.
    Quantitative: A statistic, to represent the demand
  11. 11What are the 4 types of sample?Biased
    Random
    Quota
    Stratified
  12. 12Define- Market SizeMeasurement of all the sales by all the companies within a market place
  13. 13Market Share is...Refers to calculating trends. Is the market growing or declining?
    Proportion held by one company: measured- value (mostly) and volume, shows dominance of the market.
  14. 14Market Subdivision: SegmentationThis requires splitting consumers into categories of similar characteristics
  15. 15What are mass and niche markets?Mass- Refers to the products which have universal appeal, instead of targeting segments.
    Niche- A small segment of a large market, usually a low profit and low demand section where the market is smaller.
  16. 16What should entrepreneurs do in finding the right market?They should identify a part of the market which is unsatisfied, and the products should be superior to those of the mass market
  17. 17What is a market map?A grid plotting where each existing brand sits on scales based on two important features of a market.
  18. 18What is a competitive advantage?Introducing a unique selling point or market niche that will make your company stand out from competitors e.g Green and Blacks
  19. 19Why are product trials used?Necessary for start up businesses, give the opinions of the consumers
  20. 20What is a trade off/ opportunity cost?Occasions when one factor has to be traded off against another e.g. needs of business over friendship.
    one opportunity has to be forged in order to make way for a better one in the long-term.
  21. 21What are interest rates?The money charged by a bank per year for lending money or for providing credit
  22. 22How can changing interest rates affect businesses?Low interest rates: Cause businesses to want to invest and expand their business. Creating indirect employment, helping the economy.
    High interest rates, can put businesses off expanding and affects consumer demand, meaning the total costs are higher.
  23. 23What are exchange rates?Measures the quantity of foreign currency that can be bought with one unit of domestic currency
  24. 24How do changing exchange rates affect businesses?Strong exchange rates: higher prices meaning for exporters they get less profit. For importers a strong exchange rate will mean they earn more money per unit of goods sold
  25. 25How can the governments spending and taxation affect businesses?If prices are increasing too much they may increase tax meaning a fall in demand, for a short-term pain but a long-term gain. This would lower public spending which could fail businesses for services e.g. education
  26. 26What is inflation?The annual percentage increase in price levels
  27. 27What are a few advantages and disadvantages of inflation?Ads:
    - boost revenue, but its an illusion as in real terms everything has risen too
    - Will find big loans easier to pay off as they will be receiving higher revenue
    Disads:
    - Could damage profitability
    - High inflation hits businesses under contracts
    - UK companies will find it hard to compete with foreign companies
  28. 28What are the types of finance that can be sourced?Internal: e.g. Existing capital in business - re-invested profit
    External: Borrowing from a bank, trade credit, business angel, venture capitalist
  29. 29What are unlimited and limited liability?Limited: You can only lose what you put into the business
    Unlimited: You can lose everything until debts are paid including house, car, clothes
  30. 30What are the different pricing strategies?Cost-based: (retail) constant Mark ups on clothing
    Customer-based: What a firm believes customers will pay
    Competitors pricing: Based on competitors pricing
  31. 31What is the psychological aspect of price?The higher the price the better the quality
  32. 32Everyday low pricing:Keeping prices down to build up a customer base, so customers know what to expect
  33. 33Name one other pricing strategy:Penetration pricing: if demand is highly elastic, you can set prices low to establish a customer base, changing the image of the product quality, this doesn't work if competitors then lower their prices, therefore you may have to do skimming: where you higher the prices for a short period of time
  34. 34What is break-even point?Where total revenue= total cost
  35. 35How much money per unit of sales do you have after paying variable costs. Describes?Contribution per unit
  36. 36What does a break-even chart show?It identifies how much you need to sell to reach break even, showing visual representation of whether its achievable or not.
  37. 37What is the margin of safety?The amount demand can fall before a company starts to make a loss.
  38. 38Total revenue- Total cost is the equation for?Profit
  39. 39What is the difference between fixed and variable costs?Fixed costs don't vary due to the levels of production, variable costs do.
  40. 40What are the equations for gross prift, and operating profit?GP= TR-TCOGS
    OP= GP-OC
  41. 41What is a business plan?A series of documents created by a business to gain finance.
  42. 42What would you expect to see in a business plan?Marketing strategies, Sales forecasting, Profit and loss statement and Sources of finance.

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Description
Brief flash cards to refresh your memory on the Unit one of Business studies AS specifically aimed at the Edexcel Specification
Created by
lewis001
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204
History
  • Created by polly arnold · Apr 16, 2015
  • Copied by lewis001 · Apr 16, 2015
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