Business revision

• what is Price elasticity of demand?


  measures how a change in price of a good affects the demand for that good/service.
• What is income elasticity of demand (YED)?


  measures how a change in a consumer's income affects the demand for a good.
• What is the equation for YED?


  (Percentage change in quantity demanded) / (Percentage change in income)
• Equation for PED?

  (%Change in demand)/(%Change price)
• What is market segmentation?


  Market segmentation is the process of dividing a market into distinct groups of consumers with similar needs, characteristics, or behaviors.
• What are the disadvantages & advantages of a mass market?

  Advantages: Large scale production, meaning cheaper cost per unit because of buying in bulk. More customers means more revenue. Increases brand awareness, promoting the product more.

  Disadvantages: Harder to appeal to one specific customer and higher competition.
• What are the advantages and disadvantages of a Niche market?

  Advantages: Targeted marketing, less competition. Disadvantages: Small scale market therefore limits profit, an increase on popularity may attract larger and more efficient firms.
• What are the elements of the marketing mix?

  The 7ps: Place, price, product, physical environment, promotion, people, process.
• What are influences of the marketing mix?

  finance available

  new technology

  type of product
• What is digital marketing?

  Encompasses a wide range of strategies and techniques used to promote products or services. Eg, phones.
• What are the 4 types of categories in a product portfolio?

  Cash cows, stars, question marks, dogs
• What are the product life cycle cycles

  1. Introduction
  2. Growth
  3. Maturity
  4. Decline
• What are some Pricing strategies?

  Price skimming & Price penetration
• What is price penetration?


  Low price is set to break into the market
• What is price skimming? 


  High price to yield high profit margin and gradually lowers as the market changes
• What are Influences on pricing strategies ?

  Technology and PED
• What is operations management?


  concerned with converting materials and labour into goods
• What is added value? 


  increase in worth or utility that a company adds to a product or service
• What are some operational objectives ?

  Costs, Quality, speed of response, dependability.
• What is the equation for labour productivity?

  output / num of employees
• What is the equation for unit cost ?


  total cost / output
• How do you calculate capacity utilisation? 


  (Output / max output) x 100
• What does it mean if a product is elastic?


  there will be a greater % change in demand when price is changed
• What does it mean if a product is inelastic?

  lesser % change in quantity demanded when price is changed
• What is market segmentation?

  dividing the market into clearly identifiable segments
• What are advantages of a mass market? 


  Large scale production - reduced unit costs because buying bulk.

  More customers - higher revenues

  Increases brand awareness - promoting the product more
• What are the disadvantages of a mass market?


  Harder to appeal to one specific customer and higher competition.
• What are some advantages of a niche market?

  Fewer competitors:

  They can have higher quality products because they specialise more in that field.
• what are some disadvantages of a niche market?

  Small scale market therefore can limit profits

  An increase in popularity may attract larger, more efficient firms.
• What is autocratic management?


  make decisions without consultations
• What do managers do?


  plan, organise, command, coordinate, control (cccop)
• What are benefits of autocratic management?


  Manager can take more of a lead if they have more experience.
• What are some drawbacks of autocratic leadership?


  Limited creativity, if staff are more skilled it can limit the business and can be very demotivating.
• What are some benefits democratic leadership? 


  can lead to greater job satisfaction and productivity
• What are some drawbacks of democratic leadership?


  Can be slow, the business can crumble if the skills of the workforce is lacking.
• What is some benefits of Laizzez faire leadership?

  can be more productive and high job satisfaction
• What are some negatives of laizzez faire?


  can be damaging if the workers lack skill/experience
• What is the level of authority in order?

  Tells, sells, suggests, consults, shares, delegates
• what are Influences on decision making?

  Ethics, corporate objectives, PESTLE, resources available.
• what is a stakeholder?

  any individual, group, or organisation that has an interest or concern in an business or group.