Untitled Flashcards Set

What are economic factors, and how do they influence businesses?

Economic factors are external elements that influence a business's operations, decision-making, and profitability. These include inflation, interest rates, availability of skilled and unskilled labor, and unemployment rates. Businesses must anticipate challenges and adapt their strategies accordingly.

Source: Lesson 1 - Inflation.pptx​.

Explain how interest rates can impact a business.

Interest rates affect both borrowing and saving. When interest rates rise, the cost of borrowing increases, making loans more expensive for businesses and consumers. This can reduce investment and consumer spending. Conversely, lower interest rates encourage borrowing and spending, stimulating economic growth.

Source: Lesson 2 - Interest Rates.pptx​.

How do changes in consumer demand affect business operations?

When consumer demand rises, businesses may need to increase production, hire more staff, and expand their supply chains. Conversely, a drop in demand can lead to excess inventory, reduced revenues, and potential layoffs. Changes in consumer preferences also force businesses to adapt their products or services.

Source: Lesson 3 - Puzzle Notes.docx​.

Types of Business Ownership

Define a sole trader and list two advantages and disadvantages.

A sole trader is a business owned and operated by one individual who has full control and unlimited liability.

Advantages:

Full control over decision-making.

Retains all profits.

Disadvantages:

Unlimited personal liability.

Limited access to capital.

Source: WEEK 1 - Lesson 2 (Types of Business).pptx​.

What is a partnership, and how is it different from a sole trader?

A partnership is a business owned by two or more individuals who share profits, responsibilities, and liabilities. Unlike a sole trader, a partnership allows for shared decision-making and capital investment but also requires joint liability.

Source: WEEK 1 - Lesson 2 (Types of Business).pptx​.

What are the key characteristics of a small proprietary company?

A small proprietary company meets at least two of the following criteria:

Revenue under $25 million.

Gross assets under $12.5 million.

Fewer than 50 employees.

Source: WEEK 1 - Lesson 2 (Types of Business).pptx​.

If you were starting a new business, which type of business ownership would you choose and why?

The choice would depend on factors such as liability, funding, and control. If seeking full control with low setup costs, a sole trader structure may be best. If looking to share responsibility and resources, a partnership could be a better option.

Source: WEEK 1 - Lesson 2 (Types of Business).pptx​.

Organisational Structures & Management

What is an organisational structure, and why is it important in a business?

An organisational structure defines the hierarchy, authority, and communication flow within a business. It is important because it clarifies roles, improves efficiency, and establishes accountability.

Source: WEEK 1 - Lesson 3 (Types of Business).pptx​.

Draw and label a basic functional organisational structure.

A functional structure groups employees based on their roles (e.g., Marketing, Finance, Operations).

Source: Lesson 2 - Organisational Types Notes.docx​.

What are two advantages of a functional organisational structure?

Employees develop expertise in their functional area, improving efficiency.

Clear lines of authority and responsibility within each function.

Source: Lesson 2 - Organisational Types Notes.docx​.

What is the chain of command, and how does it function in a business?

The chain of command is the formal line of authority in a business, ensuring accountability and clear reporting relationships from top to bottom management.

Source: Lesson 2 - Organisational Features Notes.docx​.

What is delegation, and why is it used by managers?

Delegation is the process of assigning tasks and authority to subordinates while retaining accountability. It helps managers focus on strategic activities while empowering employees.

Source: Lesson 2 - Organisational Features Notes.docx​.

Levels of Management

Identify the three levels of management in a business.

Top Management (CEO, Board of Directors)

Middle Management (Department Heads, Managers)

Frontline Management (Supervisors, Team Leaders)

Source: Lesson 1 - Levels of Management.pptx​.

What are the responsibilities of top-level management (e.g., CEO)?

Sets company vision and strategy.

Makes major business decisions.

Oversees the company’s performance.

Source: Lesson 1 - Levels of Management.pptx​.

What tasks are performed by middle management?

Implements strategies from top management.

Oversees department operations.

Reports operational data to senior executives.

Source: Lesson 1 - Levels of Management.pptx​.

What role do supervisors and frontline managers play in a business?

Manage daily operations.

Supervise and support employees.

Ensure workplace efficiency and compliance.

Source: Lesson 1 - Levels of Management.pptx​.