IGCSE BUSINESS STUDIES Topic : How government helps businesses

How does government help businesses? Providing cheap loans and giving grants. Providing advice and information centres for businesses. Providing college courses and training programmes for entrepreneurs. Offering subsidies or tax reduction to businesses. Maintain a stable exchange rate of the currency. Just a moment… Why does government help businesses? To help small businesses to survive and encourage competition in the economy. To encourage...

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IGCSE BUSINESS STUDIES Topic : Economic Environment factors

Economic factors affecting  business These are some of the economic environment factors which affect business At what stage of the business cycle is the economy If the economy is going through a recession it is obvious that businesses generally will not be doing well due to low aggregate demand in the economy. On the other hand, a boom period will lead to higher business profits and revenue for most of the businesses in the economy. Inflation...

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IGCSE BUSINESS STUDIES Topic : Legal environment factors affecting business

How government controls business activity? Governments control the business activities is many ways both direct and indirect. We have already covered government’s economic policies. However, government can control business activities in a more direct way. These are as follows: Controlling what to produce In order to safeguard the interest of the community government may ban or limit the production of certain goods and services. For example,...

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IGCSE BUSINESS STUDIES Topic : How fluctuation in exchange rate affects business

  Who gains and Who loses How fluctuation in exchange rate affects business. Let’s take the example of Britain and US. If the value of US$ fluctuates in comparison to UK Pound, then, how will it affect different businesses in United States? Affect of Appreciation of currency US Dollar becomes expensive as compared to British Pound. In order words, there is an Appreciation...

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IGCSE BUSINESS STUDIES Topic : Exchange rate | Appreciation and depreciation of currency

Exchange Rate Exchange rate is the rate at which one country’s currency can be exchanged for another country’s currency. How is exchange rate determined? A fixed exchange rate system refers to the case where the exchange rate is set and maintained at same level by the government irrespective of the market forces. Floating exchange rate system means that the exchange rate is allowed to fluctuate according to the market forces without...

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IGCSE BUSINESS STUDIES Topic : Globalisation - its benefits and drawbacks

What is globalisation Globalisation means the integration of national economies into the international economy through trade, foreign direct investment, capital flows, migration, and the spread of technology. According to dictionaries Globalisation (n) is the "process enabling financial and investment markets to operate internationally, largely as a result of deregulation and improved communications" (Collins) or - from the US -...

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IGCSE BUSINESS STUDIES Topic : External environment factors | PESTEL analysis

External environment factors PESTEL analysis stands for "Political, Economic, Social, and Technological, Environmental and Legal analysis". It is a part of the external analysis when conducting a strategic analysis or doing market research and gives a certain overview of the different macroenvironmental factors that the company has to take into consideration. Political factors, or how and to what degree a government intervenes in...

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IGCSE BUSINESS STUDIES Topic : Multinational businesses

What are Multinational Businesses? Businesses which have their operations, factories and assembly plants in more than one country are known as Multinational Business. They are also known as Transnational businesses. Advantages of being a Multinational Multinational can set up their business operations in countries where the labour and raw material is cheaper, which can give them cost...

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IGCSE BUSINESS STUDIES Topic : Centralisation and Decentralisation

Centralisation and Decentralisation Centralisation implies the concentration of authority at the top level of the organisation while decentralisation means dispersal of authority throughout the organisation According to Allen Centralisation is systematic and consistent reservation of authority at central points within an organisation. Decentralisation applies to the systematic delegation of authority in an organisation context. Advantages...

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IGCSE BUSINESS STUDIES Topic : Functions of a manager

Functions of the manager There are basically four management concepts that allow any organization to handle the tactical, planned and set decisions. The four basic functions of the management are just to have a controlled plan over the preventive measure. These Functions can be summarized below: Planning Planning is the first tool of the four functions in the management process. The difference between a successful and unsuccessful manager...

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IGCSE BUSINESS STUDIES Topic : Franchise - Features, advantages and disadvantages

What is franchising? The term "franchising" can describe some very different business arrangements. It is important to understand exactly what you're being offered. Business format franchise This is the most common form of franchising. A true business format franchise occurs when the owner of a business (the franchisor) grants a licence to another person or business (the franchisee) to use their business idea - often in a specific geographical...

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IGCSE BUSINESS STUDIES Topic : Cooperatives - Features, advantages and disadvantages

What is a Co-operative? A cooperative is defined as an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.A cooperative may also be defined as a business owned and controlled equally by the people who use its services or who work at it. There are different types of co-operatives: Housing cooperative A ...

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IGCSE BUSINESS STUDIES Topic : Types of Public Sector Organisations

What is Public Sector? The public sector is a part of the state that deals with the delivery of goods and services by and for the government, whether national, regional or local/municipal.Examples of public sector activity range from delivering social security, administering urban planning and organizing national defenses.The organization of the public sector (public ownership) can take several forms, including: Direct administration funded...

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IGCSE BUSINESS STUDIES Topic : Public Limited companies

Public Limited company Limited companies which can sell share on the stock exchange are Public Limited companies. These companies usually write PLC after their names. Minimum value of shares to be issued (in UK) is £50,000. Advantages  There is limited liability for the shareholders. The business has separate legal entity. There is continuity even if any of the shareholders die. These businesses can raise large capital sum as there is...

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IGCSE BUSINESS STUDIES Topic : Private Limited Companies - features, advantages and disadvantages

Private limited Companies These are closely held businesses usually by family, friends and relatives. Private companies may issue stock and have shareholders. However, their shares do not trade on public exchanges and are not issued through an initial public offering. Shareholders may not be able to sell their shares without the agreement of the other shareholders. Advantages Limited Liability: It means that if the company experience financial...

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IGCSE BUSINESS STUDIES Topic : Public Limited Companies and Stock Exchange

Public Limited Companies and Stock Exchange This short video gives an insight into the forming of a Public LImited Company and the process of listing it on the Stock Exchange....

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IGCSE BUSINESS STUDIES Topic : Limited Companies - features

Limited companies Also known as Joint stock companies. These are businesses where a number of owner(shareholder) pool in their resources to do a common business and to share the profits and losses proportionally. In a limited company, the debts of the company are separate from those of the shareholders. As a result, should the company experience financial distress because of normal business activity, the personal assets of shareholders will...

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IGCSE BUSINESS STUDIES Topic : Partnership - Features, advantages and disadvantages

What is a Partnership? A partnership is a type of business entity in which partners (owners) share with each other the profits or losses of the business undertaking in which all have invested. Partnerships are often favored over corporations for taxation purposes, as the partnership structure does not generally incur a tax on profits before it is distributed to the partners (i.e. there is no dividend tax levied). However, depending on the...

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IGCSE BUSINESS STUDIES Topic : Sole Trader or Sole Proprietor - features, advantages and disadvantages

What is a Sole trader or Sole Proprietor form of business? The sole trader is the oldest and most popular type of business. It is a form of business where there is only one owner who manages and controls the business.A sole proprietorship, is a type of business entity which legally has no separate existence from its owner. Hence, the limitations of liability enjoyed by a corporation and limited liability partnerships do not apply to sole...

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IGCSE BUSINESS STUDIES Topic : Functions of different departments

Functions of various departments Every organisation is made up of different department.  Each department contributes to the running of the business. The most common departments are:  Production Marketing & Sales Finance Human resource and in some cases, Information Technology departments Production Department The production department is responsible for converting inputs into outputs through the stages of production...

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IGCSE BUSINESS STUDIES Topic : Delegation

What is Delegation? Delegation is the assignment of authority and responsibility to another person (normally from a manager to a subordinate) to carry out specific activities. However the person who delegated the work remains accountable for the outcome of the delegated work. Delegation empowers a subordinate to make decisions. What makes an effective delegation? To enable someone else to do the job for you, you must ensure that: Objectives...

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IGCSE BUSINESS STUDIES Topic : Organisational Structure

Organisational Structure Organisational structure is defined as the relatively enduring allocation of work roles and administrative mechanisms that creates a pattern of interrelated work activities and allows the organisation to conduct, co-ordinate and control its work activities To put it in simple words Organisational structure refers to the levels of management and division of responsibilities within an organisation.In an...

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IGCSE BUSINESS STUDIES Topic : Economic Problem and Opportunity cost

Economic Problem We have unlimited Needs and wants and there are limited resources. This is the basic Economic Problem. Limited Resources Resources available on earth to make goods and services to satisfy our needs and want are limited. These resources are also known as factor of production. These can be categorised as Land All natural resources provided by nature such as fields, forests, oil, gas, metals and other mineral resources Labour The...

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IGCSE BUSINESS STUDIES Topic : Specialisation or Division of labour

Specialisation and Division of Labour Because of the fact that choice involves opportunity cost, the factors of production have to be used in the most efficient way. This is achieved through Specialisation and Division of Labour. This means every individual performs a specific task only so that he can give in the best output. Division of labour can be defined as the separation of a work process into a number of tasks, with each...

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IGCSE BUSINESS STUDY TOPIC : Types of economic systems | Planned, Market and mixed

  Market Economy/Free Market EconomyFeatures Features All the resources in a market economy are privately owned by people and firms. Every business will aim to make as much profit as possible i.e. profit is the main motive. There is consumer sovereignty. Firms will only produce those goods which consumers want and are willing to pay for. Price is determined through the price mechanism Advantages Market economies responds quickly to...

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