Business Fundamentals
What is an exit strategy?
A plan for how an owner will leave or sell the business.
What are the 4 P’s of the marketing mix?
Product, Price, Place, Promotion
What Does ROI Stand For?
Return on Investment
What is a contingency plan?
A plan "b" or backup strategy to ensure that a business can continue to function even if it faces disruptions or challenges.
What type of Intellectual property protects a sign, word or design?
A Trademark
What is a mission statement?
A short explanation of an companies purpose, values, and goals.
What is a call to action?
A call to action is a prompt that tells a user what to do next, Some examples are "Buy Now," "Subscribe," and "Learn More".
What is the point called where a businesses revenue equals total costs (zero profit)?
The Break-Even Point
What channel used when selling directly to the consumers?
Direct distribution
Give one example of unethical business behavior.
False advertising, discrimination, or insider trading, etc.
What is a company that dominates a market to the point of being the only seller of a product or service?
Monopoly
What is one example a business can collect primary data?
Surveys, Interviews, Online Forms, Observation, etc.
If a company’s revenue is $50,000 and costs are $35,000, what’s the profit margin?
30% profit margin
(Profit Margin = Net Profit / Revenue)
What is an example of an external factor that controls how a company functions?
Industry Standards, Government Regulations, Recession, etc.
What is the difference between a sole proprietorship and a corporation in terms of liability?
Sole proprietors have unlimited liability while corporations have limited liability.
What’s the difference between a sole proprietorship and partnership?
Number of owners, a sole proprietorship has one owner while a partnership has two or more.
What is psychographic segmentation?
Dividing a market into groups based on psychological traits like personality, lifestyle, attitudes, interests, and values.
Which type of financial statement would business use how much money is available to hire new staff?
Cash Flow Statement
What is a type of service a business might outsource when it is looking to expand into e-commerce?
Website, online customer service, digital marketing, IT support, etc.
What is agreement a business can use to keep it's employees from sharing confidential information with others?
Require them to sign a NDA (Non-Disclosure Agreement)
Why is upward communication important for employee morale and retention?
It makes employees feel valued, heard, and more engaged.
One reason it is important for a business to develop a marketing plan?
Design more effective promotions and impactful campaigns, reach your customers with targeted advertising, and track your business success with analytics, etc.
What is the cost of goods sold for a business when the beginning inventory was $450,000, purchases were $300,000, and the ending inventory was $200,000
$550,000
COGS = (Beginning Inventory + Purchases) –Ending Inventory
Why would the distribution channels of grocery chain look different from a book store?
The Grocery Chain has to deal with factors such as perishability making their distribution time sensitive.
Why does economies of scale turn into diseconomies of scale?
This happens when a company's growth becomes so large that it creates inefficiencies, causing the average cost per unit to increase instead of decrease. This happens due to issues like communication breakdowns, complex management structures with too many layers, and coordination problems.