3.7.3 Analysing the existing internal position of a business to assess strengths and weaknesses: overall performance

• Key financial indicators can be analyzed to assess a business's overall performance
• Market share is the percentage of total sales in a market that a business controls
• Profitability ratios measure a business's ability to generate profits
• Gearing ratios indicate the proportion of debt financing compared to equity, highlighting financial risk.


  True
• Organizational structure ensures coordination and control within the organization.


  True
• Effective HR practices lead to high employee satisfaction, low turnover, increased productivity, and improved training effectiveness.

  True
• Turnover rate is calculated as the number of employees leaving divided by total employees, multiplied by 100.


  True
• Liquidity ratios measure a business's ability to meet short-term obligations.


  True
• Stronger competitiveness indicates better overall performance.


  True
• Training effectiveness is measured using post-training tests and performance improvements
• Production Efficiency measures the relationship between inputs and outputs.
• Match the aspect of Technological Capabilities and Innovation with its description:

  Technological Capabilities ↔️ Leveraging technology to enhance operations

  Innovation ↔️ Creating new or improved offerings

  IT Infrastructure ↔️ Hardware, software, and networking systems

  R&D Capabilities ↔️ Resources for developing new technologies
• The Gearing Ratio indicates the proportion of debt financing compared to equity.
• What is the primary responsibility of the Human Resources (HR) department?

  Managing employees
• What does production efficiency measure in a business?

  Resource usage effectiveness
• What is the purpose of analyzing technological capabilities and innovation?

  Competitive advantage
• Profitability ratios measure the business's ability to generate profits
• What does market share indicate about a business?

  Sales control percentage
• Profitability ratios measure the business's ability to generate profits
• The gearing ratio measures the proportion of debt financing compared to equity
• High productivity levels indicate efficient use of resources.


  True
• Economies of scale result from increased production and reduced average costs.


  True
• A SWOT analysis evaluates the strengths, weaknesses, opportunities, and threats
• Financial ratios provide insights into a business's strengths and weaknesses in terms of profitability, liquidity, efficiency, and financial structure.

  True
• Analyzing market share and competitiveness provides insights into a business's competitive position and overall strategic performance.

  True
• Efficiency ratios measure how effectively assets and resources are being used
• Organizational structure defines the hierarchy, reporting lines, and decision-making processes
• Employee performance measures how effectively employees fulfill their job responsibilities
• Employee satisfaction is measured using employee surveys and feedback sessions
• Profitability ratios measure a business's ability to generate profits
• Market share is the percentage of total sales in a market that a business controls
• What is the formula for calculating turnover rate?

  $(\frac{\text{Number of employees leaving}}{\text{Total employees}}) \times 100$
• Production capacity represents the maximum output a business can produce with its resources.


  True
• Innovation is the process of creating new or improved products, services, or processes.
• What do profitability ratios indicate about a business?

  Ability to generate profits
• What is the purpose of an organizational structure within a business?

  Facilitate coordination and control
• Effective HR practices lead to low employee satisfaction and high turnover

  False
• Economies of scale occur when fixed costs increase with higher production

  False
• What do liquidity ratios measure in a business?

  Short-term obligations
• Match the financial indicator with its purpose:

  Profitability Ratios ↔️ Measures profit generation

  Liquidity Ratios ↔️ Measures short-term obligations

  Efficiency Ratios ↔️ Measures resource usage

  Gearing Ratio ↔️ Measures debt financing