Internal and External Growth

What is a monopoly

• A board game I played at Christmas

• Two businesses joining together

• When one retailer dominates a market

• A government body

Why does a business benefit from growth?

• It will have more competition

• It will have more market power

• It will have more overheads

What do economies of scale result in?

• Lower unit costs

• Unchanged unit costs

• Higher unit costs

What is spreading overheads an example of?

• Economies of scale

• Diseconomies of scale

• Internal growth

• Merging with another company

What is hiring more staff an example of?

• External growth

• Internal growth

• A takeover

How can small firms best compete against large rivals?

• By cutting their prices

• Through offering better customer service

• By using advertising

How can a business grow in size

• Giving staff bonuses

• Delayering

• Offering franchises

When does organic growth occur

• When a company hires more staff

• When a company merges with a rival

• When a company takes over a rival

Which of the following is not guaranteed with business expansion?

• Economies of Scale

• Market power

• Risk free profit

How often will a growing business make a profit?

• It will always make a profit

• It will sometimes make a profit

• It will never make a profit