business g10 s1 exam

What are financial aims of a business

Survival profit sales growth market share financial security

What are non financial aims of a business

Social objectives personal satisfaction challenge independence control

Why do business aims change due to market conditions

Because demand competitors and customer needs can change

Why do business aims change due to technology

Because new technology can require new investment or create new opportunities

Why do business aims change due to performance

Because strong or weak results influence future targets

Why do business aims change due to legislation

Because new laws force businesses to adapt goals

Why do business aims change due to internal reasons

Because changes in leadership resources or strategy alter priorities

What is a sole trader

One person owns and controls the business and has unlimited liability

What is a partnership

Two or more people own the business and share profits and have unlimited liability

What is a private limited company

A company owned by shareholders with limited liability and shares cannot be sold to the public

What is a public limited company

A company with limited liability that can sell shares on the stock market

What is a public corporation

A business owned by the government

What is limited liability

Owners are only responsible up to the value of their investment

Why might a government own a public corporation

To provide essential services or control strategic industries

Arguments against public ownership

Possible inefficiency less competition and high cost

What factors link to business size

Risk ownership liability sources of finance use of profits and stakeholder influence

What is a franchise

A business that sells the right to use its name brand and products

What is a social enterprise

An organisation that aims to benefit society using profit for social goals

What is a multinational

A business that operates in more than one country

What is the primary sector

Extraction of natural resources from the earth

What is the secondary sector

Manufacturing and processing of raw materials into finished goods

What is the tertiary sector

Provision of services to consumers and businesses

Factors influencing location proximity to market

Businesses may locate near customers to reduce delivery costs and increase convenience

Factors influencing location proximity to labour

Businesses need access to workers with the right skills

Factors influencing location proximity to materials

Businesses may locate near raw materials to reduce transport costs

Factors influencing location proximity to competitors

Some locate close for comparison while others avoid competition

How business activity affects location choice

Different sectors need different sites for example factories vs retail stores

How internet affects location

E commerce reduces need for physical premises

What are legal controls affecting location

Zoning laws and regulations

What are trade blocs in location decisions

Groups of countries with reduced trade barriers affecting where firms locate

What is globalisation

Growing worldwide interconnection of markets and businesses

Opportunities of globalisation for businesses

Larger markets lower costs access to labour and materials

Threats of globalisation for businesses

Increased competition risk of losing jobs to overseas production

Benefits of becoming a multinational for the business

Access to new markets lower production costs and global brand power

Benefits of multinationals to host countries

Employment technology transfer tax revenue and improved infrastructure

Drawbacks of multinationals to host countries

Environmental damage low wages profit leakage and exploitation

How to calculate exchange rates

Convert using the rate between two currencies

How exchange rate changes affect competitiveness

A weak currency makes exports cheaper and imports more expensive

Impact of exchange rate changes on importers

Strong domestic currency makes imports cheaper

Impact of exchange rate changes on exporters

Weak domestic currency makes exports cheaper for foreign buyers

Why governments spend money

To provide public services such as health education and infrastructure

Why governments have limits on public spending

Because tax revenue sets a limit and borrowing must be controlled

How infrastructure affects business activity

Better transport power and communication help businesses operate efficiently

How legislation affects business activity

Laws on safety consumer protection and employment create rules for firms

How trade policy affects business activity

Tariffs quotas and bloc membership influence import and export conditions

Effect of interest rates on businesses

Higher rates raise loan costs and reduce investment

Effect of interest rates on consumers

Higher rates reduce spending because loans are more expensive

What are social external factors

Trends attitudes lifestyles and population changes

What are technological external factors

New machines software production and communication tools

What are environmental external factors

Climate pollution sustainability and resource issues

What are political external factors

Government stability policy and regulation

Ways to measure business success

Revenue market share customer satisfaction profit growth owner satisfaction employee satisfaction

Reasons for business failure

Cash flow problems weak competitiveness and failure to adapt to market changes

Why good communication is important

Helps efficiency motivation and clarity

Problems caused by poor communication

Mistakes delays low morale and conflicts

Communication methods using IT

Email messaging video calls websites and social media

Barriers to communication

Noise language problems poor technology and unclear messages

How to remove communication barriers

Clarifying messages improving technology and checking understanding

Types of employment full time

Worker has a full weekly contract

Types of employment part time

Worker has fewer weekly hours

Types of employment job share

Two workers share one role

Types of employment temporary

Worker hired for short term or seasonal needs

What is a job description

A document stating duties and responsibilities of the job

What is a person specification

A document describing skills and qualities needed

What is an application form

A form for candidates to provide information to employers

What is a CV

A document summarising qualifications experience and skills

What is internal recruitment

Hiring someone already in the business

What is external recruitment

Hiring someone from outside the business

What is shortlisting

Choosing applicants to interview

What is interviewing

Assessing candidates through questions

What are equal opportunities laws

Rules preventing discrimination by gender race disability religion sexuality and age

What is minimum wage law

A rule stating the lowest legal pay rate

Why training is important

Improves skills productivity motivation and safety

What is induction training

Training for new workers about rules layout and expectations

What is on the job training

Learning while working with guidance from staff

What is off the job training

Learning away from the workplace often in classrooms

Benefits of training

Improved skills motivation and quality

Limitations of training

Cost time loss of output and risk of trained staff leaving

Why motivation is important

Attracts staff reduces turnover and increases productivity

Herzberg motivation theory

Motivators like achievement and hygiene factors that prevent dissatisfaction

Maslow motivation theory

A hierarchy of needs from basic needs to self fulfilment

Taylor motivation theory

Workers are motivated mainly by pay

Financial motivation remuneration

Payment for work

Financial motivation bonus

Extra reward for good performance

Financial motivation commission

Payment based on sales

Financial motivation promotion

Moving to higher level role

Financial motivation fringe benefits

Extra benefits such as car or health care

Non financial motivation job rotation

Changing tasks to reduce boredom