CAIE IGCSE Business Studies (0450) Full Summary Notes
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Course
Cambridge IGCSE Business Studies
Institution
Cambridge IGCSE Business Studies
Book
Cambridge IGCSE and O Level Business Studies 5th edition
Full summary notes for IGCSE/O-Level business studies syllabus, written based on the textbook 'Cambridge IGCSE and O Level Business Studies 5th edition by Karen Borrington Peter Stimpson [Borrington, Karen Stimpson, Peter' however well suited for other O-level equivalent subjects as well as futur...
Business management textbook summary (IB MYP and ICGSE)
Summary Cambridge IGCSE Business Studies 5th edition, ISBN: 9781510421233 Business
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CAIE IGCSE Business Studies (0450)
SECTION 1: Understanding business activity
Chapter 1: Business Activity
Chapter 2: Classification of Businesses
Chapter 3: enterprise, business growth and size
Chapter 4: Types of business organisation
Chapter 5: Business objectives and stakeholder objectives
SECTION 2: People in Business
Chapter 6: Motivating Employees
Chapter 7: Organisation and management
Chapter 8: Recruitment, selection and training of Employees
Chapter 9: Internal and External communication
Section 3: Marketings
Chapter 10: Marketing, competition and the customer
Chapter 11: Market research
Chapter 12: The marketing mix: PRODUCT
Chapter 13: The marketing mix: PRICE
Chapter 14: The marketing mix: PLACE
Chapter 15: The marketing mix: PROMOTION
Chapter 16: Technology and the marketing mix
Chapter 17: Marketing strategy
SECTION 4: Operations Management
Chapter 18: Production of foods and services
Chapter 19: Costs, scale of production and breakeven analysis
Chapter 20: Achieving quality production
Chapter 21: Location decisions
SECTION 5: Financial information and financial decisions
Chapter 22: Business finance: needs and sources
Chapter 23: Cash flow forecasting and working capital
Chapter 24: income statements
Chapter 25: Statement of financial position
Chapter 26: Analysis of accounts
SECTION 6: External influences on business issues
CAIE IGCSE Business Studies (0450) 1
, Chapter 27: Economic issues
Chapter 28: Environmental and ethical issues
Chapter 29: Businesses and the international economy
SECTION 1: Understanding business activity
Chapter 1: Business Activity
THE ECONOMIC PROBLEM
Cause of economic problems is that there are not enough factors of production to make all needs and wants.
Factors of Production:
Land - natural resources
Labour - workers
Capital - finance and equipment
Enterprise - skills/abilities of business owners/entrepreneurs
Unlimited wants + limited resources = scarcity, → opportunity cost
opportunity cost - to choose the best alternative of loss
SPECIALISATION BUSINESS ACTIVITY
is common because businesses: combine factors of production to satisfy peoples needs
specialised equipment are
produce goods and services
easy to access, low cost
and high living standard employment
division of labour ADDED VALUE
advantages: sales revenue is greater than the cost of materials
- specialised skills, to increase added value:
efficient a) increase selling price and keep material cost, convince that it is high quality
disadvantages: b) keep selling price but lower material cost
- boring, irreplaceable
Chapter 2: Classification of Businesses
SOURCES OF ECONOMIC ACTIVITIES
1. primary stage of production
2. secondary stage of production
3. tertiary stage of production
DE INDUSTRIALISATION: decrease of significance of secondary sectors
reasons:
- depleted primary sources
- loose competitiveness to newly industrialised countries
- higher consumption of services from increased living standards
MIXED ECONOMY
private sector: private owned for profit
CAIE IGCSE Business Studies (0450) 2
, public sector: government own for services
recent changes:
- public businesses sold to private: PRIVATISATION
- private sectors are more efficient, profiting, better quality, and owners invest more than government
- private businesses cut expenses for profit such as unemployment, lesser focus on social objectives.
Chapter 3: enterprise, business growth and size
ENTERPRISE AND ENTREPRENEURSHIP
entrepreneur: organise and operates new risks for a business opportunity
advantages disadvantages
independence risk of failing
able to put own ideas into practice capital
may become successful and lack of knowledge and experience
famous
opportunity cost
able to make use of personal
interests and skills
characteristics
hardworking
risk taker
creative
optimistic
self confident
innovative
independent
effective communicator
Business plan: document containing the businesses objectives and important details about the operations, finance and
owners of the new business
, 6. financial information
- source of finance
- cash flow forecast
- profitability, liquidity ratio
- predicted costs
7. business strategy
Why gov. support start up help by:
businesses:
grow further
reduce unemployment
business idea and help
increase competition
provide low cost premise
increase output
financial grants
benefit society
labour funds
research facilities
Measuring Business size:
number of ppl employed
value of output
value of sales
value of capital employed
helpful to: competitors, banks, employees, investors, governments (tax rate)
Chapter 4: Types of business organisation
Business organisations: PRIVATE SECTOR ⭐
sole traders partnerships
:business operated and owned by one person a group association agreeing to run a business
together
advantages:
advantages:
few legal requirements
more capital
freedom of choice/is their own boss
shared responsibility, motivation, and loss
does not have to share profit with others
disadvantages:
maintain secrecy
unlimited liability
close contact with customers
no continuity
disadvantages:
unincorporated business
no one to discuss matters with
limited partnerships
unlimited liability
reluctant loans
public limited companies
can’t expand
CAIE IGCSE Business Studies (0450) 4
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