Flashcards
Business term 4
Cards in this deck (17)
- 1Think of an industry (such as retail, banking or computing) and list five businesses that compete in that industry.Sample: in banking, five businesses that compete with each other are: ANZ, commonwealth, NAB, Bendigo and westpac.
- 2Explain what is meant by the term ‘competitive advantage.’A competitive advantage occurs when a business is able to produce and sell goods or services better than its competitors.
- 3Why is competitive advantage important to a business?If a business holds a competitive advantage it will raise more income and profit than its competitors.
- 4How can a business create of develop a competitive advantage?Businesses can create a competitive advantage by lowering prices, offering a wider range of product or through superior customer service.
- 5Outline the link between competition and innovation.When businesses come up with new ideas, processes or products, they give themselves an edge over their competitors.
- 6What is competitive market?A competitive market is one in which a large number of businesses are competing with each other to satisfy the demands of a large number of customers.
- 7List factors that can cause the demands of customers in a market to change.Incomes, tastes and fashion, price of complementary goods and services, demographic changes, market expectations, potential number of customers.
- 8Define the term profit margin.A profit margin is an indicator of the financial health of a business, expressed as a percentage that measures the amount of profit that a business earns from the sales of its product.
- 9Explain why a business would seek to build or create a competitive advantage.In order to be successful in the marketplace. Without competitive advantage the business will fail to differentiate itself from its competitors.
- 10Outline how a profit margin is calculated and what it reflectsIt’s calculated by dividing profits by total sales. Expressed as percentage, profit margin reflects the health and viability of the business.
- 11What might happen to a business if it did not attempt to build or create a competitive advantage when facing changing demands in a market?Businesses will be unsuccessful if they do not attempt to build or create competitive advantage.
- 12How an increase in peoples income would affect the demand for jewellery.Is likely to lead to an increase in demand for jewellery as this is considered a luxury item.
- 13How an increase in the number of people concerned about the environment would affect demand for plastic bags.Is likely to lead to a decrease in demand for plastic bags as they are considered harmful to the environment.
- 14How a surge in the price of petrol would affect demand for large cars.Could lead to a decrease in the demand for large cars. This is because large cars require high volumes of petrol.
- 15How a fall in the price of butter would affect the demand for margarine.As butter and margarine are similar products, a fall in price of butter may mean a fall in demand for margarine.
- 16How an increase in the average age of the population would affect the demand for health services.As there would be more elderly people in the community, an increase in the average age of the population would increase the demand for health services.
- 17How a decrease in the number of people who think that the economy will perform well in the next year will affect the demand for electrical products.Would lead to a decrease in demand of electrical product as people would be more concerned with saving their money.
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- Year 9 Economics and Business Flashcards on Business term 4, created by Kasey Simpson on 03/11/2023.
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- Kasey Simpson
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