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Business Paper 1 > Theme 1 > Flashcards

Theme 1 Flashcards

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1
Q

Give 4 things that an entrepreneur needs to be

A
  • Resilient
  • Innovative
  • A risk taker
  • Self confident
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2
Q

What are the 2 financial motives for starting a business ?

A

Profit maximisation

Profit satisfycing

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3
Q

What is profit maximisation?

A

To gain the largest possible profit

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4
Q

What is profit satisfycing?

A

To just make enough profit to keep the business moving and working on another aim at the same time

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5
Q

What are 2 non-financial motives for starting a new business?

A

Autonomy

Ethical stance focus

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6
Q

What is autonomy?

A

To have full control

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7
Q

Give an example of a business with an ethical stance

A

Lush - Animal testing

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8
Q

What are the 3 advantages of home working?

A
  • flexible hours
  • no workplace cost (eg. travel/rent of premises)
  • low stress environment
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9
Q

What are the 4 disadvantages of home working?

A
  • no socialisation
  • may find it hard to switch off
  • hard to avoid distractions
  • too easy to become lazy
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10
Q

Define uncertainty

A

When the business is unable to predict external shocks of future events

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11
Q

What is the aim of a business that when facing uncertainty?

A

To minimise the impact of the external shocks

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12
Q

If a household is facing uncertainty what may they do? And how will this affect businesses?

A

They may choose to save
This impacts businesses as they will not spend as much disposable income with the business and therefore this leads to a decrease in revenue for the business

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13
Q

A fluctuating currency can cause uncertainty, how can a business minimise this risk?

A

They could buy in the forward market in order to ensure certainty on what they owe, this could be more beneficial or lead the business to loose money in the future

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14
Q

How can a business minimise the risk of interest rates rising on a loan?

A

They may choose to get a fixed rate loan to ensure they know what they are paying back each month

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15
Q

Define -

Intrapreneurship

A

An employee who thinks like an entrepreneur

They solve problems, drives innovation and are proactive in adding value

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16
Q

Learning to delegate, listening to others, having an open mind, developing emotional intelligence and adopting formality
These are all traits of what moving to what?

A

Entrepreneur to leader

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17
Q

Define-

Leadership

A

The action of leading a group of people or organisation, or the ability to do this

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18
Q

Define -

Management

A

The process of dealing with or controlling things for people

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19
Q

Name the 3 types of organisational structures of a business

A

Tall
Flat
Matrix

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20
Q

In the chain of command which way do these travel…
Complaints
Orders

A

Complaints - up

Orders - down

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21
Q

Those at the top of the organisational structure have more…

A

Power and authority

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22
Q

What type of workers does the Matrix structure use?

A

Specialist

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23
Q

Utilises workers’ skills and experience regardless of position
Motivated workers in small groups working on a project
What type or organisation structure is this?

A

Matrix

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24
Q

In a business with a wide span of control what organisational structure would they have?

A

Flat

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25
What organisational structure does a business have if the span of control is narrow?
Tall
26
Define- | Delegation
The transfer of responsibility down the chain of command
27
Give one benefit and one drawback to the manager working in a narrow span of control
✅ allows specialities | ❌ more expensive - different levels of management have different levels of pay
28
Give one benefit and one drawback to the manager working in wide span of control
✅ more personal and direct control over subordinates | ❌harder to ensure subordinates are kept in control
29
Give one benefit and one drawback to the subordinate working in a narrow span of control
✅lots of promotion opportunities | ❌more distanced from depiction making
30
Give one benefit and one drawback to the subordinate working in a wide span of control
✅issues are resolved quicker - less layers | ❌harder to get promoted - motivation decreases
31
What is the type of leadership style that dictates to the employees what should be done and how it should be done?
Autocratic
32
What type of leadership sees workers as dispensable and views them to be motivated my money and fear?
Autocratic
33
What leadership style aims to include ideas and guidance from the employees and asking their opinions?
Democratic
34
What method of leadership does the manager aim to have the best interest of the employees at heart?
Paternalistic
35
What 2 styles of leadership can be linked to Mayo’s theory of motivation?
Democratic | Paternalistic
36
What leadership style allows workers to get on with it?
Laissez-faire
37
What industries are most likely to see laissez-faire to be the leadership style?
Creative industries
38
What happens to motivation levels of staff if there is an autocratic leadership for the long term?
Motivation will drop because their opinions and views are not taken into account
39
What 7 steps are the recruitment process made up of?
1) Identify there is a vacancy 2) Write a job description and person specification 3) Advertise the job 4) Candidates apply 5) Shortlist candidates 6) Interviews 7) Choosing the candidate and training
40
What are the two ways a business can advertise jobs
Internally or externally
41
What are the 2 ways candidates apply for a job
CV or Application form
42
What 3 ways can interviews be conducted?
Skype Face to face Phone
43
What is a strength and weakness of an application form for a business?
✅Quick - get what they want to know | ❌time and money to produce
44
What is a benefit for an individual of handing in a CV?
They can display all of the positive qualities about themselves - they choose
45
What are 2 drawbacks of handing in a CV to an individual when applying for a job?
It’s hard to stand out | May miss key information about themselves
46
What is a benefit of asking for CVs for a business
They don’t have to spend time and money creating a form
47
What is a drawback to a business of asking for CVs
They are long and may not always show the desired information
48
Name the 3 types of training
Induction training On the job Off the job
49
Having to pay for 2 people to do 1 persons job is a negative of what type of training
On the job
50
Which is the cheapest type of training?
On the job training
51
Which training offers the highest quality?
Off the job training
52
Which is the most expensive training?
Off the job training
53
External recruitment is cheaper than internal recruitment | True or False
False - Internal is cheaper as it can be advertised through company newsletter
54
Which form or recruitment is most likely to bring new ideas, new energy and new skills into a business
External recruitment
55
What is the average time it takes to hire someone and get them into the job?
24 weeks
56
What hidden costs could be included in recruitment
20% of all new employees leave within the first year (average)
57
Define- | Sole trader
A person who has complete ownership of the business
58
Define- | Partnership
An operation between 2 or more individuals in owning and running a business
59
Define - | Ltd
Private limited company | A small business such who doesn’t sell shares on the stock market but to family and friends
60
Define - | Franchise
The authorisation granted you a company for an individual to trade and sell their products under their name
61
Define- | Plc
Public limited company | A company who’s shares are traded on the stock exchange and can be brought and sold by anyone
62
Define - | Social enterprise
A business who’s primary objective isn’t profits but something else within the community
63
Which 2 businesses have unlimited liability
Sole trader | Partnership
64
Define unlimited liability
Unlimited liability is when the business owner has personal responsibility for the businesses debt
65
Define - | Limited liability
Limited liability is when the business owner only has to pay out the money that they put into the business
66
What is a benefits for the employer of playing commission (2)
Employer isn’t paying for when employees aren’t selling | Motivates employees to sell more
67
Who believed in a fair days pay for a fair days work?
Taylor - scientific management
68
What was Mayo’s theory?
Human relations theory
69
What did the human relations theory suggest?
That non-financial motivators were the most important - for example working in teams and job rotation

Business Paper 1 (2 decks)

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