2016 PPE gaps Flashcards
What is market capitalisation?
Current share price x number of shares
What is a variable cost?
A cost that changes with the level of output
Name the 7Ps
Product, price, place, promotion, people, process, physical environment
How do you measure labour productivity?
number of units produced/number of employees
In order, what are Maslow’s hierarchy of needs?
Physiological, safety, love/belonging, esteem, actualisation
What is contribution?
The money left over from the selling price after paying variable costs. Contribution first pays off fixed costs, then contributes to profit.
What are payables?
Money owed to suppliers by a business.
What are receivables?
Money owed to the business by customers
How do you calculate re-order level?
Calculate average stock used per day + the minimum stock level (buffer stock)
What is Hard HR?
View employees as any other resource to be used efficiently
Formula for percentage return on investment per annum
annual return/initial investment x 100
Formula for Estimated value on a decision tree
Probability of success x return on both options. Add both together
Formula for Net Gain on a decision tree
Estimated Value - Cost of project
What is profitability?
The relative efficiency of making profit from each sale NOT the total amount of profit a business makes
How can a firm measure its profitability?
Return on Capital (profit from money invested in assets) or net and gross profit margin
