Business Activity
The cost of choosing an alternative over the other
What is opportunity cost?
Organisation that works together to improve working conditions and employee wages.
What is trade union?
What are the 4Ps in marketing mix?
Product, Price, Place, Promotion
Why might a business hold inventories? Give two reasons.
1. Keeping materials just in case of supply risks
2. Might thrive from economies of scale
Profit vs. Cash?
Cash: amount of money business currently holds to fund business activities
Profit: revenue - total costs
What is market share?
The concept of human needs: with rankings of needs with the male goal of self-actualisation.
What is Maslow's Hierarchy?
What is niche marketing?
What are the possible consequences of diseconomies of scale? Form a chain.
Poor communication -> Lack of commitment from employees -> High labour turnover -> Lower output -> Less revenue and profitability
What is the importance of profit to a private sector businesses? Give a reason and explain.
The reward is big yet highly risky. There's a chance investing may fail and all finance may be lost, and it is reliant on stakeholders.
Available resources are insufficient to satisfy the population.
What is scarcity?
The advantage of on-the-job training for employees? Form a chain.
Less time and money spent -> More room to do more important activities + higher profit due to lower costs
What is a type of research that uses data directly from consumers, for example through questionnares and surveys?
How can quality assurance be implemented in a business's products? State a method and briefly explain.
Set out SMART quality standards. This can be done through primary research by first identifying customer needs, then categorising standards. Then they should be defined and documented out for all employees to strictly follow.
When a business is able to pay off its short-term assets.
What is liquidity?
Why would some business remain small despite the room to improve and gain lots of sales?
Because they prefer intimate relationships with customers and satisfying their needs accordingly. (Other similar/valid responses accepted)
What is a benefit of employing full-time workers? Form a simple chain with the answer.
1. More output; working full-time means more work is done -> high output and production -> more sales made
What is a disadvantage of a business developing new products? Form a chain.
Costs may be high short-term -> Business may involve in borrowing with interest rates -> Lower profit
What are the factors that a business could consider when deciding which country to locate operations in? Give 3 factors.
Cost of site, labour/transport costs, government incentives
A business of Country X is analysing its economic growth for the past 5 years. The GDP of X is relatively low, due to very little business activity in the country. X also has high exchange rates that makes exporting to other countries challenging. How might the business respond to this?
Business X is facing high competition in the market. It is currently making low sales, with slow production rates and less profits made. What might be its current business objective?
Survival
GreenStep establishes a type of leadership style. Its employees are highly encouraged to contribute in decision-making, and give honest feedbacks regularly about GreenStep's current operations. What is the most likely type of leadership style?
Laissez-faire
Business Y sells chairs with sophisticated designs. It is currently considering market segmentation to make sales. Y makes chairs of different kinds; from elegant & old-fashioned to child-like & dreamy. How might they segment the market?
Age
A local Big C is currently deciding the most appropriate location. It mostly sells essential items people use everyday. It wants to ensure convenience among customers to buy essentials. What might be its main objective and why?
Closer distance to the area most people live in. Being closer to the main target audience can boost convenience due to less time and costs coming to Big C. This may increase sales volume, increasing profits.
An ethical clothing brand Z learns its "sustainable cotton supplier" secretly uses child labour to keep up with demand. Replacing the supplier will cause Z's costs to rise dramatically, creating a direct conflict between profits and ethics. How should Z respond to this pressure without going bankrupt?
Immediately expose the supplier to the general public and switch supplier. This may gain ethical concern from the customer base, and due to honesty, Z may thrive from more sales as Z is willing to sacrifice its high profits to expose exploitation.