paper 1 wrong eq Flashcards
(27 cards)
give 1 reason why a business might decide to adapt one of its products
- to maintain market position
- competition/ rival products
- new technology
- existing products become obsolete
give 2 examples of resources that entrepreneurs organise
- financial resources
- human resources = employees
give 2 benefits to a business of understanding customer needs
generating sales, business survival
give 2 ways primary research can help a business to reduce risks
- make informed decisions
- understand customer needs
give 2 reasons why it is important for a business to understand its competitors
pricing, product range
give 1 way that a business can respond if a new competitor enters the local market
- change pricing
- adapt product range
- improve customer service
give 2 reasons why profitability might be an objective for an entrepreneur starting a new business
- to generate income for entrepreneur
- to enable business to grow
give 2 examples of social objectives that an entrepreneur might have when starting a new business
- environmental protection
- supporting local community
- reducing carbon emission
give 2 reasons why cash is important to a business
- to pay suppliers, employees, overheads
- to prevent business failure
give 2 examples of overheads
advertising and insurance
give 2 impacts on a business of using loans as a main source of finance
- funds available to invest in the business
- higher fixed costs due to loan repayments
- increased cash outflows -> worse net flow
give one advantage and one disadvantage of starting a business as a franchise
A = lower risk as using established business
D = cost - initial fees and ongoing royalty fees
identify 4 factors affecting business location
competitors, labour, market, raw materials
give 2 factors that might influence the price that a business charges for its product
competition, cost of product, planned level of profit
give 2 possible impacts of e-commerce on the marketing mix of a business
- increased promotion of products
- increased availability of the products beyond fixed premises
what are the key features of a business plan
- business aims/ objectives
- sources of finance
- market research
- cash flow forecast
- location details
give 2 advantages for a business of having a detailed business plan
- reduced risk
- ability to raise finance
- less uncertainty
how can a business plan help
- manage risk
- obtain finance
give 2 impacts a pressure group might have on a business
- increase wages of employees
- use different production methods
give 2 ways that legislation protects customers
- ensures products are safe
- ensure that the business cannot charge a high prices as there is no compeititon
what types of legislation protect the employee
- recruitment
- pay
- discrimination
- health and safety
give 2 impacts on a business of not complying with consumer legislation
- high staff turnover
- reputational damage
what is an advantage to a business of low levels of unemployment
high levels of consumer spending
give 2 drawbacks to a business of higher interest rates
- hgiher fixed costs e.g. loan repayments
- lower levels of sales as customers need to pay mortgage/ credit card fees.
