MOCKS revision

Question 1

What is a Market Map and what does it help you do?

Answer 1

-A tool to identify gaps in the market
-Shows where a sector is overcrowded
-Identifies competitors

Question 2

What are the 5 main areas of cash flow forecast?

Answer 2

-Cash inflows
-Cash outflows
-Net cash flow
-Opening balance
-Closing balance

Question 3

What is the purpose of a business?

Answer 3

-To make profit
-Satisfy customer needs and wants
-Provide goods and services
-Add value

Question 4

Adding value consists in:

Answer 4

-Quality
-Brand
-Design
-Convenience & speed
-USP

Question 5

What are 2 short term sources of finance?

Answer 5

-Overdrafts
-Trade credit

Question 6

What are the 6 long term sources of finance?

Answer 6

-Personal savings
-Venture capital
-Share capital
-Loans
-Retained profit
-Crowd funding

Question 7

What are Overdrafts?

Answer 7

A facility offered by the bank where an account holder can borrow money at short notice.

Question 8

What is Trade Credit?

Answer 8

Allows business to get supplies and pay for them later. (30,60,90 days)

Question 9

What is Venture Capital?

Answer 9

Money lent from successful entrepreneur in exchange of return on investment.

Question 10

What is Share Capital?

Answer 10

Business can raise finance by selling shares in the business.

Question 11

What is Retained profit?

Answer 11

Money that the business owner keeps rather than reinvesting into the business.