IGCSE Business Year 10 Block 2 Week 1
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Questions and Answers

What is one advantage of being a sole trader?

  • The owner can easily raise large amounts of capital.
  • The owner shares profits with partners.
  • The owner has complete control over the business. (correct)
  • The business has limited liability for debts.

    • Which of the following is a disadvantage of being a sole trader?

  • The owner can hire a team of managers.
  • The owner enjoys unlimited profits.
  • The owner has unlimited liability for the business debts. (correct)
  • The business can easily expand without financial issues.

    • What challenge might a sole trader face when trying to grow their business?

  • An abundance of available skilled workforce.
  • Easy competition from other sole traders.
  • Having access to an unlimited funding source.
  • Difficulty in raising the required funds for expansion. (correct)

    • If a sole trader retires or dies, what happens to the business?

    <p>The business no longer exists.</p> Signup and view all the answers

    Which statement accurately reflects the financial aspect of a sole trader?

    <p>The owner keeps all of the profits from the business.</p> Signup and view all the answers

    What is an example of a forward vertical integration?

    <p>Travel agency</p> Signup and view all the answers

    Which of the following describes a benefit of conglomerate integration?

    <p>Spreading risk across different markets</p> Signup and view all the answers

    What might a small manufacturer gain from partnering with a large manufacturer?

    <p>Economies of scale and niche markets</p> Signup and view all the answers

    Which of these is NOT a reason why some businesses remain small?

    <p>Aggressive expansion strategies</p> Signup and view all the answers

    What is a characteristic of backward vertical integration?

    <p>It focuses on raw material supply</p> Signup and view all the answers

    Which of the following is a likely reason for a business to grow?

    <p>Diversification of its product range</p> Signup and view all the answers

    What defines the concept of economies of scale?

    <p>Reduction in per-unit costs as production increases</p> Signup and view all the answers

    What is one of the main problems associated with business growth?

    <p>Increased complexity in operations</p> Signup and view all the answers

    What is a major issue that can arise from internal growth in businesses?

    <p>Increased complexity in management</p> Signup and view all the answers

    What might cause ‘diseconomies of scale’ in a business?

    <p>Bureaucratic inefficiencies from being too large</p> Signup and view all the answers

    What factor is crucial in managing potential conflicts after business integration?

    <p>Effective communication from managers</p> Signup and view all the answers

    Why might some businesses prefer to remain small?

    <p>The owners prefer a smaller scale of operation</p> Signup and view all the answers

    What can contribute to difficulties in merging two businesses?

    <p>Different business cultures</p> Signup and view all the answers

    What is a likely consequence when two businesses with conflicting management styles merge?

    <p>Conflict and inefficiency</p> Signup and view all the answers

    What do businesses need to support their growth objectives effectively?

    <p>Careful planning and sufficient resources</p> Signup and view all the answers

    What can happen if managers lack the necessary skills after a business merger?

    <p>Poor decision making and inefficiency</p> Signup and view all the answers

    What is a primary reason for the failure of many new businesses?

    <p>Poor planning</p> Signup and view all the answers

    Which factor is crucial for avoiding liquidity problems in a business?

    <p>Maintaining positive cash flow</p> Signup and view all the answers

    What can poor choice of location particularly affect?

    <p>Sales in retail, restaurants and leisure facilities</p> Signup and view all the answers

    What should successful businesses do to understand their market better?

    <p>Conduct market research</p> Signup and view all the answers

    Which of the following is NOT a cause of business failure?

    <p>Strong financial backing</p> Signup and view all the answers

    How does competition influence business failure?

    <p>It can contribute to a loss of customers</p> Signup and view all the answers

    What is often a consequence of businesses failing to invest in new technologies?

    <p>Difficulty in competing on price, design, and quality</p> Signup and view all the answers

    What is a common issue for new businesses regarding finance?

    <p>Accessing sufficient funds</p> Signup and view all the answers

    What is one reason why an owner may choose not to pursue business growth?

    <p>To avoid the responsibility of managing a larger business</p> Signup and view all the answers

    Why might some businesses choose to remain small regarding market size?

    <p>Customers prefer local services within their neighborhood</p> Signup and view all the answers

    What is a potential barrier to growth related to access to capital?

    <p>Insufficient finance to fund expansion</p> Signup and view all the answers

    In industries dominated by large companies, what challenge do small businesses face?

    <p>They struggle to compete effectively due to limited resources</p> Signup and view all the answers

    What was one reason for the failure of the budget airline discussed in Article A?

    <p>Not charging enough to cover costs</p> Signup and view all the answers

    What led to the failure of the airline mentioned in Article B?

    <p>Safety concerns leading to revenue losses</p> Signup and view all the answers

    According to Article C, what was a significant challenge for the budget airline?

    <p>An oversaturation of competitors in a small market</p> Signup and view all the answers

    What could be a consequence of not earning sufficient revenue, as stated in Article D?

    <p>Inability to pay debts</p> Signup and view all the answers

    What is a likely consequence for businesses that cannot compete on price and quality?

    <p>Long-term survival is unlikely</p> Signup and view all the answers

    Which economic factor can reduce consumer spending power?

    <p>High taxation</p> Signup and view all the answers

    Why might Misaki's revenue decrease despite selling fewer dresses?

    <p>Operating costs remain the same</p> Signup and view all the answers

    If economic conditions worsen, what could further threaten Misaki's business?

    <p>Additional job losses</p> Signup and view all the answers

    What possible strategy might Misaki consider to survive an economic downturn?

    <p>Start producing cheaper non-designer dresses</p> Signup and view all the answers

    How do high interest rates primarily affect businesses?

    <p>By decreasing available cash for expenses</p> Signup and view all the answers

    What is a potential immediate effect on a business when consumer spending decreases?

    <p>Reduced sales and profits</p> Signup and view all the answers

    What might be an effect of globalization on local businesses?

    <p>Increased competition and price pressures</p> Signup and view all the answers

    Study Notes

    IGCSE Business Year 10, Block 2, Week 1

    • Lesson Content: Focuses on business growth and size, business plans, measuring business size, reasons businesses grow or fail.
    • Do Now Activities (examples):
      • Refer to Activity 3.3 (p.38); answer questions 1 to 5.
      • Refer to the case study 'Budget airline failures' (p.41); discuss main causes of failure.
      • Refer to Activity 3.4 (p.43); answer questions 1 to 3.
      • Refer to Figure 4.1 (p.45); draw a diagram of business organization forms in the private sector.
    • Learning Objectives (examples):
      • Chapter 3 – Entrepreneurship, business growth and size
      • Why some businesses grow and others remain small
      • Why some businesses fail
      • Understanding enterprise, business growth, and size
    • Success Criteria (examples):
      • Know the main problems associated with business growth.
      • Identify reasons why some businesses remain small.
      • Understand the main causes of business failure.
      • Recognize various business organizational forms.
      • Explain advantages and disadvantages of sole trader businesses.
    • Key Concepts (examples):
      • Internal Growth: Often slow; risk of other businesses using external strategies growing faster.
      • Mergers & Acquisitions: Potential difficulties in managing combined teams, integrating cultures, etc.
      • Diseconomies of Scale: Increased costs as a business becomes too large.
      • Market Size: Considering local vs. national markets, competition, and customer preferences.
      • Capital Access: Financing needed for business expansion, potentially harder for smaller businesses.
      • Market Domination: Businesses facing high competition from large companies.
      • Economic Influences: Unemployment and high costs can affect customer spending.
      • Business Failure: Factors contributing to failure include poor planning, liquidity issues, and poor marketing.
    • Important Figures and Tables (examples):
      • Figure 3.7 – Factors affecting business growth.
      • Figure 3.8 – Causes of business failure (e.g., poor planning, lack of finance).
    • Textbook/Coursebook references: Several references to specific pages (e.g., p.41, p.45).
    • Homework: Exam-style practice questions (p.44) and other activities, deadlines to be confirmed.

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    Related Documents

    IGCSE Business Year 10 Lesson Slides PDF

    Description

    This quiz covers essential concepts of business growth, size, and the factors influencing business success and failure. Students will explore case studies, answer questions, and engage with diagrams related to entrepreneurship. Mastery of these topics is crucial for understanding the dynamics of businesses in the real world.

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