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Question 1

why do businesses grow?

Answer 1

profit and survival

Question 2

how do businesses grow?

Answer 2

organic and inorganic

Question 3

what is the difference between organic and inorganic growth?

Answer 3

organic is internal and inorganic is external

Question 4

how can you internally grow a business?

Answer 4

taking advantage of technology. changing marketing mix. expanding overseas

Question 5

how can you externally grow a business?

Answer 5

merging and takeover

Question 6

example of merger and takeover.

Answer 6

merger- curry’s and PC world
takeover- pound land and 99p store

Question 7

what is offshoring?

Answer 7

when you expand your business overseas

Question 8

what are 2 anagrams for economies and diseconomies?

Answer 8

economies- FBTR
diseconomies- PCCM

Question 9

what is economies and diseconomies of scale?

Answer 9

diseconomies- bad things that can happen to a business
economies- good things that can happen to a business

Question 10

what is the difference between and LTD and PLC?

Answer 10

LTD- private limited company
PLC- public limited company

Question 11

what are the advantages + disadvantages of a PLC?

Answer 11

+ raise capital quickly
+ limited liability
x exposed
x costly administration

Question 12

what do we mean by ‘floating shares’?

Answer 12

buying shares on the stock market is online so the shares are floating.

Question 13

what is the difference between aim + objective?

Answer 13

aim- long term
objective- short term

Question 14

how do aims and objectives change as your business grows?

Answer 14

they grow along side the business

Question 15

list 2 internal and 2 external sources of finance a large business can use.

Answer 15

internal- retained profit, sale of assets
external- loan, share capital

Question 16

what is retained profit?

Answer 16

money left over from a previous business

Question 17

give an advantage and disadvantage of retained profit.

Answer 17

advantage- able to re-invest into the business
disadvantage- once it is used it is gone.

Question 18

difference between overdraft and a loan

Answer 18

overdraft- short term amount of money from the bank
loan- a long term amount of money from the bank

Question 19

advantages and disadvantages of crowdfunding

Answer 19

+ brand awareness
+ easy and quick
x takes time
x give money back if all is not raised

Question 20

what is share capital? give 1 advantage and disadvantage.

Answer 20

selling shares to family and friend.
+ no interest
x these shareholders will then be entitled to share off the profits of the business.