IGCSE, A Level Business Student Forum

KN: The main reason for profit maximizing by a business is that the business has achieved the leadership of the market share.
APP: for example a global mobile company like samsung may dominate global sales so it may shift its focus towards profit maximizing.
AN: The comapny may reduce its costs of ...

KN: Business objectives can change timely depending on market performance and conditions.
APP: for example a newly opened store in its first year focuses on survival and creating a loyal customer base, and if it is successful in doing so it may change its objective towards growth and expand by ...

KN: It may allow the business to have local support.
APP: For example a fertilizer company like engro opens a new factory and hires local people and train them accordingly.
AN: This allows the business to reduce regional unemployment, gain local support, produce a much skilled labour as the local ...

KN: increase in the market share is the percentage of total sales in the industry made by one business increasing it means that the business is expanding and capturing a larger portion of the market.
APP: For example coca-cola aims to increase its market share in the soft drink industry in order to ...

KN: Capital gain is the profit a person makes on selling a stock at higher price than the original price.
APP: For example a person buys a stock for 100$ and sells them for 150$ this means that the capital gain for the stock is 50$.
AN: This allows the person to increase their wealth without using ...

KN: If a business is seen damaging the environment it will face backlash from the people resulting in reduce share price in the market.
APP: For example an oil company causing frequent oil spills may face public backlash and reduced support from the public.
AN: this can result in reduced confidence ...

KN: A business might not aim to maximize profits in the short term as it might focus on creating a market presence and increase market share initially.
APP: For example a mobile company might set low prices for a newly launched mobile in order to attract customers and create market share.
AN: lower ...

KN: The restaurant may suffer with reduced demands die to using cheaper costs.
APP: for example a restaurant might start using cheaper quality oil, or spices for cooking it's dishes.
AN: this might result in the decline of the brands reputation, decrease competitiveness in the local and ...

KN: Business objectives may differ based on the size of the business.
APP: For example a small grocery store may focus on surviving in its first year while a supermarket like Al Fatah may already have a strong market presence.
AN: A small grocery stores main objective may be to create a loyal ...

KN: An econiomic problem is when a country's GDP falls, this leads to a lower spending ratio in consumers.
APP: For example a housing company like Bahria town may find it difficult to sell houses to more people.
AN: The company may focus on survival instead of growth so it can maintain its ...

KN: Value of sales is a better way to measure the size of a business as th evalue of sales gives the value of goods sold while a value of production only gives value of products made regardless of their sale position.
APP: For example a car manufacture like ford might produce 10000 cars and only ...

KN: Market share shows the percentage of sales a business does in an industry but does not reflect its actualpotential or size.
APP: For example a car manufacturing company like toyota may have higher market share while am EV company like revian may have less market share even though it has high ...

KN: Camital employed provides information regarding the value of assets a firm uses for its operations but does not provide an accurate comparison between the firm sizes.
APP: For example an airline company like Qatar airways may purchase premium aircrafts while another company may lease the ...

KN: using the number of employees to measure the business size can be misleading as it shows only how many workers work in business and not reflect its true size or value.
APP: For example, a large autoated car manufacturing company may employ fewer emplyees but its production will be higher dur to ...

KN: capital employed is the total value of assets a business uses to opperate making it a good indicator for determining the size of capital intensive indutry.
APP: For example an airline company like emirates owns a large fleet of planes worth billions which make it a high capital employed company ...