Business Activity
What is the purpose of a business?
To satisfy customer needs and make profit
What is recruitment?
Finding and hiring employees
What is marketing?
Identifying and satisfying customer needs
What is production?
Making goods or providing services
What is revenue?
Price × quantity sold
What is an entrepreneur?
Someone who starts and runs a business taking a risk.
What is training?
Improving employees’ skills and knowledge
What are the 4Ps?
Product, Price, Place, Promotion
What is productivity?
Output per worker/time period
What is profit?
Revenue − total costs
What is added value?
Selling price − cost of bought-in materials
What is motivation?
The willingness of employees to work hard
What is market segmentation?
Dividing a market into customer groups
What is job production?
One product made at a time
What is a fixed cost?
A cost that doesn't change with output
Name one factor of production.
Land / Labour / Capital / Enterprise
What is one benefit of delegation?
Frees managers time
What is market research used for?
To understand customer needs and preferences
What is lean production?
Reducing waste while maintaining output
What is break even?
When total revenue = total costs
Why might a business change from a sole trader to a limited company?
To gain limited liability and raise more capital
Why might financial rewards fail to motivate some employees?
Employees may value non financial rewards more
Why might a business use penetration pricing?
To quickly gain market share
Why might a business choose automation?
To increase productivity and reduce labour costs
What happens if a business's margin of safety is negative?
It is operating below its break even output