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Business: All Topics
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Edexcel IGCSE Business
Business: All TopicsComplete deck
01·1.1 Business objectives
What is a business objective?
Answer
A target that a business aims to achieve and uses to guide its decisions and activities.
02·1.1 Business objectives
What is a financial business objective?
Answer
An aim concerned with a business’s financial performance or financial position, such as survival or profit.
03·1.1 Business objectives
What is a non-financial business objective?
Answer
An aim not directly concerned with making money, such as personal satisfaction or improving society.
04·1.1 Business objectives
What does the survival objective mean?
Answer
Keeping the business operating, especially during start-up or difficult trading conditions.
05·1.1 Business objectives
What is profit?
Answer
The amount remaining when total costs are deducted from total sales revenue: profit = total revenue − total costs.
06·1.1 Business objectives
What is profit maximisation?
Answer
The objective of earning as much profit as possible.
07·1.1 Business objectives
What is a sales objective?
Answer
An aim to increase the amount of goods or services sold by the business.
08·1.1 Business objectives
What is market share?
Answer
The proportion or percentage of total sales in a market accounted for by one business or brand.
09·1.1 Business objectives
What does increasing market share mean?
Answer
Increasing a business’s proportion of sales relative to the overall market.
10·1.1 Business objectives
What is financial security as a business objective?
Answer
Earning enough from the business to provide a reliable income and financial stability for its owner.
11·1.1 Business objectives
What does profit satisficing mean?
Answer
Seeking a satisfactory level of profit rather than the maximum possible profit.
12·1.1 Business objectives
What is a social objective?
Answer
An aim to benefit people, a community or the environment rather than focusing solely on financial return.
13·1.1 Business objectives
What is personal satisfaction as a business objective?
Answer
Seeking enjoyment, pride or a sense of achievement from running a business.
14·1.1 Business objectives
What does challenge mean as a business objective?
Answer
Wanting to test and develop skills or solve problems through running a business.
15·1.1 Business objectives
What does independence mean as a business objective?
Answer
Wanting the freedom to work for oneself rather than being directed by an employer.
16·1.1 Business objectives
What does control mean as a business objective?
Answer
Wanting to make key decisions about the business’s direction and use of time and resources.
17·1.1 Business objectives
What does SMART stand for when setting objectives?
Answer
Specific, Measurable, Achievable, Realistic and Time-specific.
18·1.1 Business objectives
What makes a business objective specific?
Answer
It states clearly and precisely what the business aims to achieve.
19·1.1 Business objectives
What makes a business objective measurable?
Answer
Its achievement can be checked using a quantity or other clear measure.
20·1.1 Business objectives
What makes a business objective achievable?
Answer
It can be reached by the people involved, given their capabilities and circumstances.
21·1.1 Business objectives
What makes a business objective realistic?
Answer
It is practical given the resources that the business can use.
22·1.1 Business objectives
What makes a business objective time-specific?
Answer
It states a definite deadline or time period for achievement.
23·1.1 Business objectives
Why do clear business objectives improve decision making?
Answer
They give owners and managers a focus, helping them choose actions that contribute to agreed targets.
24·1.1 Business objectives
How can clearly communicated objectives motivate employees?
Answer
Employees understand what they are working towards and can see how their efforts contribute to business success.
25·1.1 Business objectives
How can objectives help a business assess performance?
Answer
Actual results can be compared with targets so managers can identify shortfalls and adjust decisions.
26·1.1 Business objectives
Why might a newly established business prioritise survival?
Answer
It may have few customers, high start-up costs and uncertain revenue, so staying open comes before expansion.
27·1.1 Business objectives
Why might an established business still focus on survival?
Answer
Strong competition or difficult trading conditions may threaten its ability to continue operating.
28·1.1 Business objectives
Why can profit be important to business owners?
Answer
It rewards their effort and the risk of investing money in the business.
29·1.1 Business objectives
How can a profit objective support business growth?
Answer
Retained profit can finance extra equipment, premises or other activities needed for expansion.
30·1.1 Business objectives
Why are high sales sometimes associated with lower average costs?
Answer
Greater output can allow a business to spread some costs across more units, reducing average unit cost.