Chp. 3: Size of Business - AS Level

Which of the following is not accepted as ways to measure business size?

• Number of employees

• Revenue

• Capital employed

• Profit

The total value of sales made by a business in a given time period.

• revenue

• capital

• price

• target market

An expansion of a business by means of opening new branches, shops or factories (also known as organic growth).

• internal growth

• external growth

• advertising

• enterprise

Which of the following is a correct example of external growth?

• merger

• sole trader

• opening new branches

• loan

Which of the following is an importance of small & micro-business?

• not many jobs are created by small firms.

• small businesses are often run by dynamic entrepreneurs, with new ideas for consumer goods and services.

• small firms cannot create competition for larger businesses.

• small firms often cannot supply specialist goods and services to important industries in a country.

True or False: Profit is not a good measure of business size – but it can be used to assess business performance.

(a)  

The sales of the business as a proportion of total market sales.

• market share

• customers

• revenue

• profit

An advantage of small business.

• can afford to employ specialist professional managers

• have access to several different sources of finance

• are more likely to be able to afford research and development into new products and processes

• offer personal service to customers

Business that are actively owned and managed by at least two members of the same family.

• partnership

• joint venture

• family-owned business

• private limited company

Disadvantage of large business.

• may often suffer from a divorce between ownership and control that can lead to conflicting objectives

• few opportunities for economies of scale

• may have limited access to sources of finance

• may not be diversified, so there are greater risks of negative impact of external change