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14 Cards in this Set
- Front
- Back
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How is the gross margin of a business calculated?
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Gross margin = outputs - variable costs
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What is the law of diminishing returns?
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Increasing an input will eventually descrease the output production value per unit input
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What are the THREE stages of production?
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Stage I - proportional increase of output with increasing input
Stage II - diminishing returns Stage III - overall decrease of output with increasing input |
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What is productivity?
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Efficiency of conversion of inputs to outputs
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What is the difference between economic and technical optimum?
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Economic optimum is maximum productivity
Technical optimum is maximum production |
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What is partial budgeting?
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An equation used to decide if a proposed change to an enterprise is worthwhile:
(new costs + revenue forgone) - (costs saved + new revenue) |
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What is investment appraisal?
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Considers an investment in terms of costs and benefits, and when they will occur
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What is discounting?
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Converts costs and benefits of an investment into present values (e.g. less interest if money had been invested instead)
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What is financial feasibility analysis?
How does economic feasibility analysis differ? |
Financial feasibility considers whether a project will demonstrate sufficient funds to repay the loan (+ interest) used to purchase it.
Economic feasibility considers whether such funds will be available when loan repayments are due |
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What is sensitivity analysis?
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Considers all variables to determine best- and worst-case scenarios, and which parameters influence profitability most
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What is decision analysis?
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Considers the value of a decision in terms of probability of chance events and value of various outcomes
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What are the FOUR types of company that a veterinary practice may be under?
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Sole trader (business and owner same entity. Unlimited liability)
Partnership (business shared between up to 20 owners) Limited company (separate identity to owners and limited liability. Audited accounts must be accessible to public) Public limited company (company is publicly traded) |
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What are the FOUR Ps of marketing?
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Product
Price Place Promotions |
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How should clinical audits be conducted?
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Areas to be audited should be DREAM (distinct, relevant, evidence-based, achievable and measurable)
Protocols and standards must be fixed |
