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WorksheetsFinance for business growth
Total questions: 20
Worksheet time: 15mins
Profit that a business has saved from previous years is known as
Net profit
Gross profit
Retained profit
A disadvantage of using retained profit to grow the business is..
You have to repay it
It can slow the rate of business growth down
Its very risky
The benefits of using retained profit to fund business growth are.
It doesn't have to be repaid
Its quick
You don't have to pay interest
Its low risk
Retained profit is
An internal source of finance
An external source of finance
An asset is
Money in the bank
Something a business owns such as buildings or vehicles
Something a business owes to the bank
Selling assets is
An internal source of finance
An external source of finance
A benefit of selling assets to raise capital is
It is a quick way to raise capital
It has to be repaid
You can raise unlimited amounts of capital
A disadvantage of selling assets to raise capital is...
You have to repay it
It is expensive
If the business grows, you may need to replace these assets
Loan capital is...
An internal source of finance
An external source of finance
All businesses that apply for a loan will get one
True
False
Large businesses with a lot of buildings (collateral) are likely to get a loan at a cheaper interest rate than smaller businesses.
True
False
The base rate (the interest rate set by the Bank of England) affects the interest rate you pay on a loan
True
False
Interest rates in the UK are very low at the moment
True
False
What would banks want to see before lending you money to expand?
Credit history (proof you are good at repaying debt)
Cash flow forecasts (evidence you will be able to repay future debt)
Evidence of collateral (assets the bank can take away if you don't repay the loan)
Your advertising materials
A list of your customers
Share capital is
Money you borrow from a bank
Money invested in the business by individuals in return for a stake (share) in the business
Money the business has saved over the years
Only public limited companies can sell shares on the stock market
True
False
Becoming a public limited company (Plc) makes it easier to take over other businesses
True
False
If a business owners sells over 50% of their shares to other shareholders, they lose control over the running of the business.
True
False
When one business buys all the available shares of another business, this is known as
Organic growth
A merger
A takeover
Snap inc (the company that own Snapchat) raised how much from their IPO (when they floated shares on the stock market)
$3,000
$30,000
$300,000
$3000,000,000
