Business growth

Which one of the following is an example of organic growth?

• Tesco sells off Giraffe restaurants

• Tesco buys based firms

• Tesco merges with another supernarket chain

• Tesco opens more convenience stores

A manufacturer of apple juice merges with an orchard. This is best described as an example of:

• Forward vertical integration

• Horizontal vertical integration

• Backward vertical integration

• Conglomerate integration

A fashion designer merges with a high street clothing retailer. This is an example of:

• Backward vertical integration

• Forward vertical integration

• Horizontal integration

• Conglomerate integration

An example of a technical economy of scale is:

• Using management experience to lower costs

• Buying in the expertise of an IT specialist

• Buying the most up to date machinery

• Using the internet to buy inventory

Which one of the following is an example of a reason to stay small?

• Gain diseconomies of scale

• Greater flexibility in responding to customer needs

• Increase brand recognition

• Create barriers to entry

Which one of the following is a barrier to entry?

• Internet

• Substitue products

• Brand loyalty

• Market size

What are some financial problems with rapid external growth?

• expansion can be expensive

• takeover can be expensive

• additional fixed capital and working capital will be required

• all 3 are correct

When a business grants a licence to use its brand and reproduce its product.

• Joint Ventures

• Mergers

• Acquisitions

• Franchising

Expanding the product line is an example of what type of growth?

• Internal growth

• External growth