Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

business studies > Paper 1 advanced information > Flashcards

Paper 1 advanced information Flashcards

1
Q

What does marketing involve

A

Understanding customer needs.
Understanding dynamics of the market.
Developing successful products.
Promoting the business.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What is the difference between risk and uncertainty

A

Risk is there because employers commit resources such as money they may potentially lose.

Uncertainty exists because an entrepreneur does not know what may happen with external factors such as a pandemic.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What are the characteristics of a mass market

A

Target large population of the market with generic product.
Requires large-scale production.
High sales revenue.
Many other businesses in the market.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What are the characteristics of a niche market

A

Target small population of the market with specialised products.
Production on a small scale.
Few competitors.
Businesses compete on quality and customisation.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

what is a dynamic market

A

A market that is constantly changing. Have features such as high innovation.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

How do you calculate market share

A

Sales of a business
—————————– x100
Total sales in the market

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

How does low competition affect the market

A

Businesses- Dominate the market, afford inefficiencies and charge high prices.

Customers- Limited choice, pay high prices and accept poor service.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

How does high competition affect the market

A

Businesses- Incentive to innovate, improve efficiencies and competitive pricing.

Customers- Lots of choice, good value for money and exciting new product developments.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

What is market research

A

Is where a business will attempt to gather information on its target audience and their opinions on products/services.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

What are two benefits of primary market research

A

Specific to the needs of the business.

Reduce risk by making more informed decisions.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What are two negatives of primary market research

A

Can be time consuming and costly.

Difficult to gather a wide sample.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What are two benefits of secondary market research

A

Fast and less time consuming.

Less expensive.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What are two negatives of secondary market research

A

Access to some data can cost money.

Not always up to date.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What is a supply curve

A

Line on a graph it will always slope upwards as if price increases the supply will increase.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

How does supply and demand interact

A

If a price increases in a market demand would decrease because people would be less willing to buy the product at that price leading to a surplus. If price decreases demand would increase as people would be more willing to buy at that price leading to a shortage.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

How does supply affect price

A

If there is an excess in supply this will lower prices. This is because producers will have to lower their prices in order to sell all of their goods. The opposite will happen if there is a fall in supply so producers will increase their prices.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

What is an agent or broker

A

Someone who links buyers and sellers usually with specialist knowledge.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What is a wholesaler

A

Buy products in bulk from manufacturers and then they sell them on to a network of retailers.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

What is a retailer

A

Provide customers with the opportunity to browse products to buy and enjoy a shopping experience.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

What is direct selling

A

When a business sells its products person to person. Can be done through telephone calls or websites among other ways.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

What are channels of distribution

A

Determine the way products reach the customer.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

What are influences on distribution

A

Scope/scale.

Nature of the product.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

What are the benefits of online distribution

A

Customers can shop 24/7

No costs of operating a retail store

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

What are the negatives of online distribution

A

No one can buy during a site crash.

Customers can’t try before they buy which could be off-putting.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

What are three characteristics of an entrepreneur

A

Self-confidence- believe they can be successful.

Self-determination- need to overcome problems they may face.

Initiative- adapt to changes.

26
Q

What are three skills of an entrepreneur

A

Organisation- lots to coordinate when setting up a business.

Financial management- cash flow management can be hard for a new business.

Negotiating- negotiating deals with customers and suppliers can be challenging.

27
Q

What are financial motives for setting up a business

A

Profit maximisation- to generate as much wealth as possible.

Profit satisficing- to generate as much profit as necessary to live comfortably off.

28
Q

What are non-financial motives for setting up a business

A

Ethical stance- support ethical principles.

Social enterprise- running a business for a social or environmental cause you believe in.

Homeworking/independence- be your own boss and work from home.

29
Q

What are the features of a sole trader

A

Own boss but work long hours.

Unlimited liability.

Require wide range of skills.

30
Q

What are the features of a partnership

A

Deed of partnership between 2-20 people.

Unlimited liability through shared responsibility and reward.

31
Q

What are the features of a private limited company

A

Process of incorporation is time consuming.

Limited liability.

Wider access to capital.

32
Q

What are the features of a public limited company

A

Raise capital through selling shares.

Susceptible to hostile takeovers.

33
Q

What are the features of a franchise

A

Limited company licenses rights to others to trade under their name.

Effective for growth.

Risk of brand being damaged.

34
Q

What is importing

A

Buying goods or raw materials from a foreign country.

35
Q

What is exporting

A

Selling products and services to foreign customers.

36
Q

What is comparative advantage

A

A country’s ability to specialise in production of certain goods and trade them with other nations.

37
Q

What is foreign direct investment

A

Direct investment into a foreign country leading to a business becoming a multinational corporation.

38
Q

What are the benefits of FDI

A

Invest in growing industries and profitable businesses.

Access to local knowledge and skill.

Access to local resources.

39
Q

What are the key features of globalisation

A

Flow of capital between countries.

Multicultural society.

Goods and services traded.

40
Q

What is protectionism

A

Protecting domestic industry by use of tariffs and subsidies.

41
Q

What is NAFTA

A

North American Free Trade Agreement. A free trade zone between member countries including trade, investment, labour, financial dealings and environmental legislation. Members can negotiate their own trade deals with outside members.

42
Q

What is the EU

A

A single market with free movement of people, goods and services. EU adopts common law around employment and consumer legislation. Common currency for most members in the “euro”.

43
Q

What is ASEAN

A

Association of South East Nations. A free trade agreement between politically and economically diverse countries.

44
Q

What are benefits of trading blocs

A

Opportunity to expand into new market.

Easier to source labour if free trade is permitted.

Allows businesses to benefit from comparative advantage.

45
Q

What are negatives of trading blocs

A

Infant industries are vulnerable to international competitors.

Tensions with regions outside the trading bloc.

Businesses from outside the trading bloc may benefit from comparative advantage the businesses inside can’t.

46
Q

How do exchange rates affect global competitiveness

A

Elasticity of demand- Demand for a product may change due to exchange rate fluctuations affecting price.

Economic growth- Could cause an appreciation in the currency so demand could fall.

Fixed contracts- Contracts with fixed exchange rates mitigates the effects of exchange rate fluctuation.

47
Q

What is cost competitiveness

A

MNCs operating on a global scale benefit from economies of scale or can be their own suppliers through vertical integration so therefore have lower unit costs. They can then charge lower prices making them cost competitive.

48
Q

What is differentiation

A

A business may adapt a polycentric approach to marketing and adapt their products to meet the need of the local people. One way a business may do this is by buying foreign brands to allow it to do this.

49
Q

What are skill shortages

A

A business will face times when it will experience skill shortages and this will reduce the effectiveness of its workforce. International businesses may be able to have access to workers with skills found outside of its own country such as artisan cheese makers in Italy.

50
Q

What is the impact of MNCs on job creation

A

The creation of a factory or plant can create hundreds of jobs. Allows for the development of skills for the people and attracts people to come work at the factory which demand for local businesses may be generated.

51
Q

What is the impact of MNCs on wages and working conditions

A

Increased demand in a local area for skilled workers would cause a wage rise if unemployment is low. Working conditions and fringe benefits will also improve as a result.

52
Q

What is the impact of MNCs on local businesses

A

A large MNC company will have a supply chain made up of many other businesses. This means new opportunities will be created for local entrepreneurs when an MNC operates in the area.

53
Q

What is the impact of MNCs on community and environment

A

An MNC is likely to have negative effects in the local area such as congestion and pollution. To combat this a business may improve local infrastructure or support local organisations like schools.

54
Q

What is the impact of MNCs on infrastructure

A

An MNC may find that sufficient infrastructure is in place when they arrive in an area. An MNC will invest into local infrastructure to improve it which will benefit everyone.

55
Q

What is the impact of MNCs on social enterprise

A

An MNC may invest in local charities and social enterprises to support the local community. This will may be done to fulfil their social responsibility or to improve their image.

56
Q

What is the impact of MNCs on FDI

A

When an MNC relocates a factory to a country this leads to a huge investment into the country (FDI). This creates spending in the economy and creates jobs lowering unemployment.

57
Q

What is the impact of MNCs on balance of payments

A

Products and services produced by the MNC may be exported around the world. This brings a second flow of money into the country after FDI.

58
Q

What is the impact of MNCs on technology and skills

A

MNCs may bring advanced technology with them and upskill the foreign population. This knowledge and technology will naturally transfer into the foreign country.

59
Q

What is the impact of MNCs on customers

A

Increased competitiveness in an industry for customers could benefit them through:
Lower prices.
More choice.
Better quality.

60
Q

What is the impact of MNCs on culture

A

Business culture from MNCs will naturally transfer itself to local businesses through the growth of the MNC.

61
Q

What is the impact of MNCs on transfer pricing

A

An MNC will sell its products in a country with lower taxes even if it was produced in a country where taxes are higher. MNCs do this to avoid paying higher tax however it may mean governments lose out on tax revenue.

business studies (8 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions