Topic 2.1 - Growing the Business Questions

4 reasons why its good to trade internationally?

* more potential customers internationally
* more competition from foreign companies
* access to a wider variety of materials, components and finished goods
* access to cheaper and skilled labour

3 advantages of free trade?

* gives access to more customers and markets
* easier access to materials and components internationally or to relocate production
* firms may gain more investment from oversees to expand

3 disadvantages of tree trade?

* firms may have to cut prices to compete and advertise more with free trade
* greater risk of takeover by foreign firms
* international competition may damage UK firms

what are the 2 things that trade blocs lead to?

trade blocs lead to

* reduced or zero taxes on import
* less rules and regulations restricting trade - e.g quotas or legal restrictions

which are import taxes a problem?

import taxes act as a barrier to trade

what are the 2 things that tariffs can do?

tariffs can

* make foreign goods more expensive so it helps UK firms compete , projecting jobs and businesses
* raises the cost of imported materials, components and finished goods so higher costs for business and higher prices for consumers

Sales can increase through 3 ways which are?

* selling to more customers in existing markets
* finding new markets
* launching new products through innovation, research and development

what can profits and loans be used to ? \*

profits and loans can be used to expand (e.g the building of new stores)

3 advantages of internal/organic growth?

* less expansive than
* less risky because it can be better planned for
* easier to control

3 disadvantages of internal/ organic growth?

* can be very slow
* growth may be limited (e.g by a lack of funds)
* opportunities may be missed

3 advantages of inorganic growth

* c