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66 Cards in this Set
- Front
- Back
Name the two Sectors of the Economy?
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Public
Private |
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Name two advantages of a sole trader?
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Keep all the profits
No confilcts |
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Name two diadvantagers of being a sole trader?
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Unlimited Liability
Have to work long hours Limited capital |
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Name two advantages of being a partnership?
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Share workload
More Capital More Ideas |
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Name two diadvantages of being a partnership?
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Unlimited Liability
Disagreements Share Profits |
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Name two advantages of being a private Limited Company(LTD)?
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Limited Liability
Incorporated |
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Name two disadvantages of being a private Limited Company(LTD)?
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Expensive to set up
Have to publish accounts |
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Name two advantages of being a public Limited Company(PLC)?
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Easy to raise capital (Shareholders)
Can expand easily limited liability |
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Name two disadvantages of being a public Limited Company(PLC)?
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Easy to be taken over
Each shareholder has very little say |
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What are the 4 P's?
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Product
Place Price Promotion |
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Field research is what type of research?
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Primary
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Desk research is what type of research?
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Secondary
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What are the advantages of field research?
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Can be made relevant to your business
Up to date information |
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What are the Disadvantages of Field research?
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Expensive
Time consuming |
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What are the advantages of Desk research?
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Cheaper
Easily Found |
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What are the disadvantages of Desk research?
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May not be relevant
Out of Date |
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What is Penetration pricing?
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-Charges a low price then when people get interested they increase the price
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What is Skimming?
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-Starts of with a high price and when the product becomes less desirable they decrese the price
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What does the primary sector do (give an example)?
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Provides the raw materials e.g. Farming etc
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What does the secondary sector do (give an example)?
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Turns the raw materials into finished goods e.g. Building, funiture making etc
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What does the tertiary sector do (give an example)?
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Provides the service for the finished good/service e.g. Tesco, Spar etc
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Name the Three types of Production?
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Job
Flow Batch |
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What is Job production?
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Making an individual, unique product, e.g. a tailored suit
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What is Flow production?
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Made in a continous line, they usually operate for 24 hours a day e.g. chocolate bars, toasters etc.
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What is Batch Production?
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Making products that are identical to each other, produced in limited quantities e.g. Houses, Furniture
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What is Just in time production?
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Where the stock arrives in factory immediately before being used
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Name one advantage of Just in time production?
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Don't have to pay for storage cost
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Name one disadvantage of Just in time production?
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Requires co-ordination, it may not arrive
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What is contained in a Job description?
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What the job consists of
Formal title Main Duties What they are responsible for |
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What is contained in a Person Specification?
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Ideal: Qualifications
Experience Skills etc...... |
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Total Costs =
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Variable costs +Fixed costs
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Break-even Output =
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Fixed Costs
-------------------------- Contribution per unit |
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When does the break-even point occur?
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When the total revenue = total costs
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Name 3 sources of Internal Finance?
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Retained Profit
Credit Control Fixed Assets |
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Name 3 sources of external finance?
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Bank Loan
Hire Overdraft |
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Name the 3 sections in the Profit and Loss Account?
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Trading account
Profit and Loss account Appropriation account |
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Current Ratio =
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Current Assets
------------------------ Current Liabilities |
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Acid Test ratio =
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(Current Assets - Stock)
----------------------------- Current Liabilities |
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What is Economies of Scale?
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Large firms lowering the avarge costs by buying things in bigger quantities
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What is Horizontal Intergration?
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Taking over a business that deals in the same product/service
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What is Forward Intergration?
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Taking over a businness that is ahead of you in the chain of selling the product e.g. Walkers taking over Tesco
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What is Backward Intergration?
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Taking over a business that provides the service/product for you e.g. Cadbury's taking over a Cocoa business
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What is Lateral Intergration?
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Taking over a business that has no relevence to your business e.g. Coca Cola taking over Nike
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What is a multinational business?
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A business that operates in more than one country
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What is a oligopoly?
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Where there is alot of businesses operating in one market e.g. cars
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What is an monopoly?
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When the market is dominated by one company e.g. Royal Mail
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What is Nationalisation?
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When a business is taken from the Private to the Public Sector
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What is Privatisation?
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When a business is taken from the Public sector to the Private sector
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What is a Quota?
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A physical limit on the quantity of a product that can be imported
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What is a Tariff?
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A tax placed on products when they are imported
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What is Value Added Tax (VAT) a tax on?
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Goods and services
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What is income tax a tax on?
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The workers income
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What is National Insurance contributions (NIC'S)?
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Paid buy a business, which contributes to paying towards state pension and state benefits
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What are Uniform business rates?
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A tax paid by companies to cover the cost of local goods and services
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Name 3 Direct taxes?(tax on income and capital)
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Income
Comrporation National Insurance contributions |
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Name 2 Indirect Taxes?(taxes on goods and services)
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Value Added Tax
Excise Duty |
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What is a Deed of partnership?
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A legal contract which governs how a partnership will ber owned and organised
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Return on Capital Employment =
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Net Profit
---------------------- x100 Capital Empoyed |
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Net Profit=
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Gross Profit+Non-Sales Revenue -Operating costs
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Gross Profit=
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Sales Turnover-Cost of Sales
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Net Profit margin=
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Net Profit
------------ x100 Sales |
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Gross Profit Margin=
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Gross Profit
-------------- x100 Sales |
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What are Fixed Costs?
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Costs which remian the same whatever the level of output (sales) of the business
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What are Variable Costs?
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Costs which vary directly with the output of the business
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Give an example of a fixed cost
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Rent of the premises
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Give an example of a variable cost
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Raw materials
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