Year 10

Help with
using your
revision
guide

Student name:_________________
Form:________________________

What is this booklet for?

It DOES NOT replace good hard work and thorough revision!
This booklet has been put together to help you use your revision guide more effectively.

Why do you need to know key terms?

In the exam you will be asked several types of questions. Some will just ask you to define a
term. Some will ask you to use that term in a short answer and some will ask you to be more
analytical and use the key terms in more detailed answers. The final type will be the questions
that will ask you to make a recommendation, based on an analysis of the context given.
Thus, the basis of everything is your knowledge of the Key Terms in this subject area.

How could you use this booklet?

When devising a suitable revision plan you may find it hard where to start?
Thus, you could use this guide to help focus:

What key terms you MUST learn and understand

Where in your textbooks and revision books they can be found

How could I actually start?

1. Start to read the key terms in this booklet and test yourself to see if you know them. If
not, look at the definition. Test again!
2. Then, look up the reference in the textbook and test yourself again.
definition if you need to

Look at the

3. Then, look up the term in the revision guide and see if you know it yet.
By this time you would have looked at the term at least THREE times in different places.
Because it is set out in a different way in each place (this booklet and the two books) you should
have a better understanding of the term.
TEST yourself again, or, get a friend or relative to do it.

THERE IS NO SUBSTITUTE FOR HARD WORK!

2

Key Terms
Key Term

Definition

Stakeholders

An individual or group of people who have an interest in a business. Includes

workers, customers, owners and the local community

Entrepreneurs

Is someone who is willing to take the risks involved in starting a business.

Entrepreneurs believe that the rewards of starting a business are worth the
risks and costs involved.

Social Enterprise

Is a business that is set up to help society rather than to make a profit.

Market share

Is indicated by the sales of one product compared to the total market sales.

Franchisee

Is the buyer of a franchise.

Marketing

Finding out what the potential customers want and satisfying that want normally for a profit (although there are not-for-profit organisations and the
public sector)

Franchise

A marketing arrangement which allows another business to trade in the same

style as an existing business E.g. McDonalds

Market information

Data collected on potential markets about the make-up of the market.

Information could be things such as rivals prices, the size of the market
(number of customers or value in pounds), consumer needs or fashion.

Market research

The collection of data on customers habits to help decision-making in

marketing. The main two types are Primary and Secondary(also known as Field
and Desk)

Notes

Key Terms
Key Term

Definition

Notes

Objective

(Or aim) is a target that is set for a business to achieve.

Public Sector
Organisation

Are owned by the government

Private Sector
Organisations

Are owned by individuals

Business Plan

Is a document setting out what the business does at present, plus what it
intends to achieve in the future and how this will be accomplished. The plan will
include marketing and financial plans.

Business Planning

Is the process of producing a business plan.

Risk

Is the possibility of something going wrong.

Uncertainty

Is something that we cannot be sure will happen.

Deed of Partnership

Is an agreement between partners that sets out the rules of the partnership,
such as how profits will be divided and how the partnership will be valued if
someone wants to leave.

Market segmentation

How the market for a product or service is divided. Examples are age, gender,
income, region, race and religion, interests and socio-economic

Marketing mix

Also known as the 4Ps of marketing.

Promotion.

They are Product, Price, Place and

Key Terms
Product

Product a business must try to supply products/services that consumers

want. This information may have come from Market Research. This includes
the Product Life Cycle the life of a product, usually shown as a graph divided
up into five stages: introduction, growth, maturity, saturation and decline

Price

Price consumers are usually very concerned with price, so products/services

must be priced so that consumers are prepared to buy them. The main
methods are: competitor pricing, cost-plus pricing, penetration pricing,
skimming, differential, promotional pricing and psychological pricing

Place

Place this is concerned with how the product is distributed and sold to the
final consumer. It includes the channels of distribution.

Promotion

Promotion a business must decide how to let the potential consumers know
about its product/service. There are many ways that a business can do this:
price reductions, loss leaders, point-of-sale, free samples, merchandising, (PR)
public relations, sponsorship and advertising (the various types of these are
TV, radio and newspapers - both local and national, cinema, magazines,
billboards and posters, internet and transport such as on a bus)

Key Terms
Key Term

Definition

Marketing strategy

A marketing plan to achieve the businesses marketing objectives. The

marketing objectives are targets that a business sets to achieve the overall
objectives of the business.
The strategy is about targeting the right market segment with the
appropriate marketing mix

Primary research

Data collected first hand, often in the form of surveys. Sometimes referred
to as field research

Secondary research

Data collected using research or information provided by others, such as

magazines, journals and the Internet. Often called desk research

Product development

Creating a new or improved good or service, for release into an existing market
E.g. a new, more up-to-date mobile telephone

Notes

Key Terms
Key Term

Definition

Operations
Management
(Production)
Batch production

Method of production where one type of product is made and then production
is switched to make a different product

Customer Loyalty

Means that a businesss customers makes repeat purchases because they

prefer the businesss products to those of its rivals.

Customer Protection
Laws

Laws that have been introduced to prevent businesses from treating their
customers unfairly

Customer Service

Meeting customers needs as fully as possible

After-sales service

The meeting of customers needs after they have purchased a product, for
example by repairing or servicing the product.

E-Commerce

The act of selling a product using the internet.

Efficient Production

Takes place when a business uses a minimum amount of resources to produce

its goods and services.

Division of labour

Dividing the employees within a business to complete separate tasks. This way
more is achieved as employees work on what they are good at links with
Specialisation

Flow Mass Production

Production of one product takes place continuously using a production or

assembly line

Notes

Key Terms
Key Term

Definition

Information and
Communications
Technology (ICT)

The computing and communications systems that a business might use to help
to give good customer service.

Job Production

The method of production where products are made individually

Premises

The buildings used by businesses these may include offices, shops and
factories.

Global Markets

Are made up of customers from across the world.

Notes

Key Terms
Key Term

Definition

Location of business

The factors that a firm needs to take into account when deciding to locate
their business. Factors could be: availability of raw materials, cost of location,
access or nearness to markets, availability of labour to work for you, climate
and physical geography, transport and infrastructure, tradition, nature of
product or service and government policy

Production Technology

The introduction or constant changes in use of technology can have a massive

impact upon most businesses E.g. the introduction of robots onto a production
line as less people are needed but the staff that stay need to receive training
to operate and service the machines. It could also be the use of scanners at a
checkout, chip-and-pin technology or the use of a database in market research

Quality

Making sure that the product or service is of the right quality all of the time.
Various methods can be used such as: TQM, Quality Assurance, Quality Circles
and Kaizen (continuous improvement)

Quality assurance

Checks are carried out at each stage of the production process this could
include checks on raw materials and parts being brought in

Quality circles

When workers in small teams meet on a regular basis to discuss how quality can
be improved (part of TQM)

Quality control checks

Are made on completed products

Notes

Key Terms
Key Term

Definition

Total Quality
Management (TQM)

The process where all workers are responsible for quality throughout the
process of production

Specialisation

When workers concentrate on only one task or responsibility. Usually used

with division of labour as this is done to enable staff to specialise.
Partnerships often specialise to enable partners to concentrate on what they
are good at. Widely used in Flow production and in Batch to speed up
production again

Notes

Key Terms
Key Term

Definition

Structure and
Organisations
Private Sector

This includes all the business owned by private individuals E.g. sole traders,
partnerships, private and public limited companies

Sole Trader

One person owns the business. This type of business is extremely easy and
cheap to set up with few forms to be completed. Disadvantages include that it
has unlimited liability and the owners often have to work very long hours. Sole
traders are usually local businesses such as window cleaners, decorators,
electricians, etc

Partnership

A form of unincorporated business owned by more than one person.

Partnerships allow for specialisation with one partner concentrating on one
aspect of the business. Each partner can also introduce capital so there are
more funds available. The business is still characterised by unlimited liability.
Examples of partnerships would be your dentist, and doctors surgery

Private Limited
Company

A business owned by shareholders. It is identified by the words Ltd or Limited

somewhere in the name. Shares can only be sold to family and friends (shares
can only be sold privately). This type of business has limited liability. Examples
of private limited companies would be Cause way Press Ltd, Virgin, etc

Notes

Key Terms
Key Term

Definition

Limited Liability

The owner of a business does not risk losing personal possessions in order to pay
off the debts of the business. Unlimited liability is where owners of the
business are liable for the debts

Franchise

This is where an already established business (the franchisor) offers for sale to
other businesses or individuals (the franchisee) the right to use its products,
services or logo, in a defined area. Businesses which are franchises are the
Body Shop, Mc Donalds, Theatre Coach, etc

Voluntary or Charitable
Sector

This is composed of non-profit making organisations that aim to raise money

rather than make a profit. Examples of charities would be Oxfam, RSPCA, etc

Notes

Key Terms
Key Term

Definition

Finance
External Finance

Finance obtained from outside the business e.g. loans, share issues, leasing, hire
purchasing, grants, etc

Insolvency

Occurs when a business is not able to meet its financial commitments when they
are due.

Receiver

Is a person who takes responsibility for an insolvent business and makes

arrangements to pay its debts

Internal Finance

Finance from within the business including retained profits, sale of unwanted
assets and management of working capital (keeping stock levels low, chasing
debtors for quick payment, etc)

Long Term Finance

Finance is required for more than 3 years e.g. bank loan, mortgage, taking on
a new partner, share issue, lease, hire purchase, etc

Short Term Finance

Finance is required for less than a year e.g. overdraft, trade credit,
factoring, etc

Revenue

The value of sales. The quantity of goods sold multiplied by the selling price.

Profit

Sales Revenue Total Costs = Profit

Cash Flow Forecast

A cash flow forecast shows the anticipated inflow of cash (sales income, loans,
sale of assets, grants, etc) and outflows (cost of stock, wages, overheads,
dividend payments, interest) each month. If a firm has more cash outflows
than inflows in a month it is said to have a negative cash flow

Notes

Key Terms
Key Term

Definition

People in
Organisations
Authority

Means having power or control over something.

Discrimination

Is treating one person differently from another without having a good reason to
do so.

Role and functions of

managers

Managers are responsible for the control and supervision of an activity or a group
of activities. A manager makes decisions about the day to day running of a
department in order to achieve its objectives. A manager might be involved in the
setting of objectives or that might be done by managers at higher levels in the
organisation. There can be several layers of management

Financial methods of
motivation

Where monetary reward is used to motivate workers e.g. commission, bonuses,

profit-sharing, pension scheme

Non-financial
motivators

These methods address higher level needs in the hierarchy and are about personal
fulfilment. E.g. workers are empowered by job enrichment or the chance to train
for promotion. Team-building exercises and award schemes also motivate workers

Job description

A document containing the title of the job, who the person is responsible to
and/or for and the duties and tasks involved

Job Enrichment

Is designing a job to give interesting and challenging tasks.

Legislation

Is a set of rules that governs the way society operates. It is another term for
laws

Person specification

A document detailing the desirable and/or essential skills, qualifications,

knowledge and experience required for the job role to be carried out effectively

Notes

Key Terms
Key Term

Notes

Recruitment process

The step-by-step process that a business can go through to help them recruit
the right employee for the job.

Advertising

The process of making sure you advertise the job in the right place to attract
the right person for the job.

Selecting

The process of choosing the right person for the job. This would involve using
the application letter, the CV, the interview or the on-the-job test to make
sure you choose the right person.

Equal opportunities

Choose the right person regardless of their ethnicity, age, sex or disability.

Training

Making sure the new person you recruit and existing employees can do the job
by training them appropriately.

Training methods

The ways you train your employees. These are On-the-job where you train
the person whilst still doing the job and the other is Off-the-job where the
employee attends some form of training outside the business. E.g. college.

Key Calculations
Throughout the year 10 syllabus you may need to undertake calculations. Here
are examples of ones you may have to do:

Accounting and Finance

Most calculations appear mainly in this section which is why you should have a
calculator for the exam (See the key terms section if you are unsure what
these are!).

Costs fixed, variable, running and start-up

Revenue
You will have to undertake some simple arithmetic i.e. addition, subtraction,
multiplication and division.
E.g. a car showroom
(Per month)
Fixed costs of
Total variable costs of
Total Costs of
Revenue for a hatch-back
Number sold each month
Total revenue gained

20 000
10 000
30 000 just added up!

Money paid
OUT from a
business

12 000 EACH
15
15 multiplied by 12 000 is 180 000

Profit
Calculated by Total Revenue MINUS Total Costs
So, using the example from above:
Total Revenue is
Total costs are
Profit is

180 000
30 000
180 000 MINUS 30 000 = 150 000

Money coming
into a business

Cash Flow
There are two types:
1) A forecast this is a prediction of what will happen
2) A statement this is what did actually happen
The cash flow forecast is easy to work out. This example is taken from your
mock exam:
Cash flow for Judith and Stuart
Jan

Cash brought forward

6000
Sales Revenue
1500
Total cash available
7500
Wages
3000
Rent and rates
300
Cost of materials
1400
Total costs
4700
Cash balance
2800

Feb
2800
1800
4600
3000
300
1500
4800
-200

Mar

-200
2200
2000
3000
300
1600
4900
-2900

Apr

-2900
3000
100
3000
300
1800
5100
-5000

May
-5000
4000
-1000
3000
300
2000
5300
-6300

Jun
-6300
5000
-1300
3000
300
2000
5300
-6600

Here are the calculations you need to make:

Total cash available just add sales and cash brought

forward

Total costs just add all costs up

Cash balance Total cash available MINUS Total costs
Cash brought forward is the SAME as the cash balance
from the previous month

Motivation monetary rewards

As part of this you may need to complete a simple calculation. This example is
taken from June 2003 exam paper:
Sandra is the editor of BEAs magazine. As part of her job she has to raise
money by selling advertising space in the magazine. Sandras motivation is low.
Her manager has offered her the chance of benefiting from a bonus scheme
linked to increases in advertising income. This would be paid on a rising scale as
per the box below.
Increase in
advertising
revenue ()
0 to 5000
5001 to
10000
Over 10000

Percentage of
the increase paid
as a bonus (%)
on the
first
5000
on the
next
5000
on the
rest

10
15
20

The question asked was:

If advertising revenue increased by 12000 in the first

year, calculate how much Sandra would receive as a bonus. Show your
working (3)

Here are the calculations you need to make:

Total bonus =

10% of 5000 =
15% of 5000 =
20% of 2000 =
1650

500
750
400

Marketing
There is lots of scope for calculations, but, in Cost-plus pricing you may have to
calculate the price of a good or service.
For example:
A laptop computer may cost Dell 500 to make. They may use a simple cost-plus
pricing policy. So, of they had a 50% mark up that would be:
500 MULTIPLIED by 50%= 500 * 0.50
= 250
Now ADD 250 and 500 = 750 Sales Price

An easier way of doing it is:

500 MULTIPLIED by 1.5 = 750 (it makes it much

simpler to do)