Interview
IGCSE Business Notes Chapter 1 to 17 Cambridge
- Module
- Institution
- Book
Notes Covering Chapters 1-17 from "Cambridge IGCSE and O Level Business Studies 5th Edition"
[Show more]
Connected book
Book Title:
Author(s):
- Edition:
- ISBN:
- Edition:
More summaries for
-
Grade 11 marketing (chapter 11)
-
Business Studies IGCSE/O Level - Full course summary
-
all answers to exam style questions of business book igcse
Seller
Follow
vikistanimir
Content preview
1Business Exams Notes
Chapter one: Business activity
Business: combine factors of production to make products satisfying customer wants.
Need: good/service essential to living.
Want: good/service people would like to have but is not essential.
Economic problem: unlimited wants, limited sources; causes scarcity.
Scarcity is lack of sufficient products to fulfil total wants for population.
Factors of production: resources needed to produce goods.
- land, labour, capital, enterprise (businessman putting the 3 factors together).
Opportunity cost: next best alternative given up by choosing another item.
Specialisation: when people/businesses focus on what they’re best at.
Division of labour: production process is split into tasks. Form of specialisation.
Added value: difference is selling price and cost of bought-in materials. Increase by:
- Increase selling price but keep costs the same.
- Reduce costs of material but keep price the same.
Chapter two: Classification of businesses
Stages of economic activity: Compared by % of people working and value of output of goods.
(1) Primary: extracts/uses natural resources to produce raw materials; fishing, farming, etc.
Poor countries employee most people in this sector.
(2) Secondary: manufactures goods using raw materials; baking, construction, etc. Developing
countries (China) are industrialising to employ most people in this sector.
(3) Tertiary: services to consumers; retailer, hairdresser, etc. Highly developed countries
(Norway) have extra income for services so many people work in this sector.
Industrialisation: Decline in primary sector. Poor countries turning to developing countries.
De-industrialisation: Decline in secondary sector. From developing to highly developed.
Mixed economy: both private and public sector. Done by selling public business to individuals. This
is called privatisation.
- Done because: private businesses are more efficient, or to raise money for government.
- Private business increase employment rates to cut costs.
Chapter three: Enterprise, business growth, and size
Entrepreneur: person organising, operating, risking for a business venture.
- Independent, and may be profitable.
- Risky; many fail.
Characteristics include; hardworking, risk-taker, confident, innovative, etc.
Enterprise is person who brings three factors of production together to form business.
Business plan: document about objectives, operation details, finance, and owners. Without plan
bank won’t lend money since owners haven’t showed planning/preparation. It includes:
, 2
- Description
- Products/Services
- Market
- Location and distribution channel
- Management
- Financial information; projected future finance, income statements, financial position.
- Strategy
Governments support start-ups to: Governments support start-ups by:
- Decrease unemployment rates. - Premises: low cost
- Increase competition. - Finance: loans and grants
- More output - Research facilities
- Can grow further.
Interested in business size are banks, workers, government (tax rate), and investors (bigger is
businesses are less risky).
Businesses are measured by:
- People employed: most important but automatic companies are at a disadvantage.
- value of output: businesses in same industry. Some produce few but expensive products.
- Value of sales: important but inaccurate when businesses sell different products.
- Value of capital employed: total capital invested; equity and LT loans.
Owners expand because: possibility of higher profit, status, low average costs (manufacturing).
Internal growth: existing operations expand (organic)
External growth: Integration; mergers and takeovers
Takeover: business buys out another business.
Merger: owners agree to join businesses as one.
Integration:
- Horizontal: merger/takeover in the same industry at same stage of production.
(1) less competitors, and economy growth.
- Vertical: merger/takeover in same industry but different stage. Backward or forward.
(2) Forward: assured outlet and profit margin is absorbed.
(3) Backword: assured supply of components.
- Conglomerate: merger/takeover in different industry – diversification.
(4) Spread risk out.
Problems with growth include:
- difficult controlling: operate in small units.
- Expansion costs: ensure long-term finance is available.
Why remain small?
- Type of industry: hairdresser, car repairs
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller vikistanimir. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for £2.56. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
67474 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy revision notes and other study material for 14 years now