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66 Cards in this Set

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Out of Date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