CIE AS-Level Business 9609 Lecture Notes

Comprehensive flashcards covering the CIE AS-Level Business 9609 syllabus, including enterprise, management, marketing, operations, and finance.

What is the formula for calculating Added Value?

$$Added value = \text{Selling price} - \text{cost of bought in materials}$$

Define Opportunity Cost.

The benefit of the next most desired option given up when making a choice.

What does the acronym 'LET B' stand for regarding the dynamic business environment?

Competitors (Other Businesses), Legal changes, Economic (Market has less to spend), and Technological (Obsolesce).

What are the four factors of production needed by a business?

Land, Labour, Capital, and Enterprise.

What are the three objectives of the Triple Bottom Line for social enterprises?

Economic (reinvest profits), Social (provide jobs), and Environmental (sustainability).

Differentiate between the Primary, Secondary, and Tertiary sectors.

The Primary sector extracts natural resources; the Secondary sector manufactures and processes natural resources; the Tertiary sector provides services.

What is the meaning of Limited Liability?

The owners' personal assets cannot be taken to pay off company debt; the only potential loss is the face value of their shares.

What are the two key legal documents required to establish a limited company?

The Memorandum of Association (MOA) and the Articles of Association (AOA).

Name four measures used to determine the size of a business.

Number of employees, Revenue, Capital employed, and Market capitalization.

What is a Mission Statement?

A statement of a business’ core aims phrased to motivate employees and stimulate interest from outside groups.

Define Management by Objectives (MBO).

Coordinating and motivating staff by splitting the overall business aim into specific targets for each department, manager, and employee.

According to Mintzberg, what are the three categories of management roles?

Interpersonal, Informational, and Decisional roles.

What are Goleman's four main Emotional Intelligence (EI) competencies?

Self-awareness, Self-management, Social awareness, and Social skills.

Contrast McGregor’s Theory X and Theory Y.

Theory X assumes workers dislike work and avoid responsibility; Theory Y assumes workers derive enjoyment from work and find it creative.

According to Herzberg, what is the difference between hygiene factors and motivators?

Hygiene factors (e.g., salary) can cause dissatisfaction if missing but do not motivate long-term; motivators (e.g., achievement) lead to positive job satisfaction.

What is the formula for calculating Labour Turnover?

$\frac{\text{Number of employees leaving in 1 year}}{\text{Average number of people employed}} \times 100$%

Define Market Orientation.

A business approach that focuses on constant feedback and market research to reduce risk, as opposed to prioritizing the product itself.

What is the formula for Market Share?

$\frac{\text{Sales of a firm}}{\text{Total sales in the market}}$ for a given time period.

List the 4Ps of the Marketing Mix and their corresponding 4Cs.

Product (Customer Solution), Price (Cost to customer), Promotion (Communication), and Place (Convenience).

What is the formula for Price Elasticity of Demand (PED)?

$$\frac{\text{\text{\%} change in demand}}{\text{\text{\%} change in price}}$$

Define USP (Unique Selling Point).

A factor that differentiates a product from its competitors; what one business has that others do not.

What are the three types of Channels of Distribution (COD)?

Direct selling (Producer to consumer), One intermediary (Agent/Wholesaler to consumer), and Two intermediaries (Wholesaler to Retailer to consumer).

How is Productivity measured?

$$\text{Productivity} = \frac{\text{Output}}{\text{Input}}$$

Define Mass Customisation.

Using flexible computer-aided production to produce goods according to individual customer requirements at mass-production cost levels.

What are the four main types of Economies of Scale?

Purchasing, Technical, Financial, and Marketing economies.

Differentiate between Capital Expenditure and Revenue Expenditure.

Capital Expenditure is spending on assets expected to last more than one year; Revenue Expenditure is spending on daily costs like wages and raw materials.

Define Working Capital and provide its formula.

The capital needed for day-to-day running costs; calculated as $Current Assets - Current Liabilities$.

What is Venture Capital?

Risk-capital invested by individuals or groups in businesses with high profit potential that cannot easily gain finance from traditional sources.

Define Marginal Cost.

The extra cost of producing one more unit of output.

What is the formula for the Acid-test ratio?

$$\frac{\text{Current Assets} - \text{Inventory}}{\text{Current Liabilities}}$$

What is the formula for the Gross Profit Margin?

$\frac{\text{Gross Profit}}{\text{Sales}} \times 100$%