Business Studies

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What is a market?
A market is any place where buyers and sellers meet to trade products - it could be a high street shop or a web site.
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What does dynamic mean?
This means that they are always changing.
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What is primary research?
(field research) involves gathering new data that has not been collected before. For example, surveys using questionnaires or interviews with groups of people in a focus group.
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What is secondary research?
(desk research) involves gathering existing data that has already been produced. For example, researching the internet, newspapers and company reports.
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What is quantitative research?
Factual information.
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What is qualitative research?
Information collected about opinions and views .
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What is a market map?
A market map is a diagram that identifies all the products in the market using two key features.
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What does the red circle in a market map identify?
The red circle identifies a gap in the market.
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What is a competitive market?
A competitive market has many businesses trying to win the same customers.
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When does a monopoly exist?
A monopoly exists when one firm has 25% or more of the market, so reducing the competition.
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Governments encourage competition because it can help improve these factors:
Price, Product range, Customer service.
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What is the marketing mix?
The marketing mix is the combination of product, price, place and promotion for any business venture.
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What does unique selling point mean?
The unique thing about the product that makes consumers buy it. This can be branding, packaging or a feature of the product.
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What is a product?
A product is a good or a service that is sold to customers or other businesses.
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What is product differentiation?
A business needs to choose the function, appearance and cost most likely to make a product appeal to the target market and stand out from the competition.
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What are the four stages in a product life cycle?
Launch, growth, maturity, decline.
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What happens in the launch and growth stages?
Sales rise.
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What happens in the maturity stage?
Revenues flattern out.
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What do extension strategys include?
Updating packaging, adding extra features or lowering price.
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What is a product portfolio?
A product portfolio is the range of items sold by a business. It can be analysed using the Boston Matrix.
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What are star products?
Star products have a high market share in a fast growing market.
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What are cash cow products?
Cash Cows have a high market share in a slow growing market.
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What are question marks or problem children products?
Question marks or problem children products have a low market share in fast growing markets.
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What are dog products?
Dogs are products with a low market share in slow growing markets.
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What is the difference between cost and price?
Costs are the expenses of a firm. Price is the amount customers are charged for items.
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What is penetration pricing?
Penetration pricing means setting a relatively low price to boost sales. It is often used when a new product is launched, or if the firm’s main objective is growth.
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What is price skimming?
Price skimming means setting a relatively high price to boost profits. It is often used by well-known businesses launching new, high quality, premium products.
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What is promotion?
Promotion refers to the methods used by a business to make customers aware of its product.
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What is place?
Place is the point where products are made available to customers. A business has to decide on the most cost-effective way to make their products easily available to customers.
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Why do businesses need finance?
Start up a business, eg pay for premises, new equipment and advertising.Run the business, eg having enough cash to pay staff wages and suppliers on time.Expand the business, eg having funds to pay for a new branch in a different city or country.
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What does short term mean?
Must be paid back within a year.
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What does long term mean?
Can be paid back over many years.
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What is meant by internal sources?
Internal sources of finance are funds found inside the business.
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What is meant by external sources?
External sources of finance are found outside the business, eg from creditors or banks.
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Sources of external finance to cover the short term include:
Overdraft facility, Trade credits, Factoring.
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Sources of external finance to cover the long term include:
Loans, Debentures, mortgage, Hire purchase or leasing, Grants.
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What is a creditor?
A creditor is an individual or business that has lent funds to a business and is owed money.
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What is a debtor?
A debtor is an individual or business who has borrowed funds from a business and so owes it money.
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What is revenue?
Revenue is the income earned by a business over a period of time, eg one month.
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The amount of revenue earned depends on two things:
the number of items sold and their selling price.
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Revenue is sometimes called...
sales, sales revenue, total revenue or turnover.
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What are costs?
Costs are the expenses involved in making a product. Firms incur costs by trading.
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What do variable costs do?
Change with the amount produced.
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What do fixed costs do?
Stay the same even if more is produced.
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What is total costs?
total cost is the amount of money spent by a firm on producing a given level of output. Total costs are made up of fixed costs (FC) and variable costs (VC).
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What is profit?
Profit is the surplus left from revenue after paying all costs.
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How is a loss made?
A loss is made when the revenue from sales is not enough to cover all the costs of production.
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Other cards in this set

Card 2

Front

What does dynamic mean?

Back

This means that they are always changing.

Card 3

Front

What is primary research?

Back

Preview of the front of card 3

Card 4

Front

What is secondary research?

Back

Preview of the front of card 4

Card 5

Front

What is quantitative research?

Back

Preview of the front of card 5
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