Month: December 2017

Business Studies Multiple Choice Question – 26 December 2017

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

A business’s fixed costs are £10 000, selling price per unit is £4, and total variable costs per unit are £1.50. Which ONE of the following is the break-even level of output (to the nearest whole number)?

Select ONE answer only:

  1. 2 500 units
  2. 2 857 units
  3. 4 000 units
  4. 4 500 units
  5. 6 667 units

Show your workings to arrive at your answer, and explain and justify your reasons:

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This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 3 – Break-even level of output = Fixed costs / Contribution per unit. Contribution per unit = Selling price per unit – Variable costs per unit. Therefore the breakeven level of output is: £10 000 / (£4 – £1.50) = £10 000 / £2.50 = 4 000 units.

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Business Studies Multiple Choice Question – 25 December 2017

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Which ONE of the following is the correct definition of margin of safety?

Select ONE answer only:

  1. The amount by which total revenue has to grow before it passes the break-even of output.
  2. The amount by which total revenue can fall before a business is unable to cover its total fixed costs.
  3. The amount by which output can fall before a business reaches its break-even level of output.
  4. The amount by which the total revenue of a business exceeds its total costs.
  5. The amount by which a business’s actual output exceeds its planned level of output

What is the importance of measuring the break-even point to businesses?

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This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 3 – The margin of safety is the difference between the level of output a business plans to achieve, or has actually achieved (ie number of items produced or sold, or number of customers served, as opposed to revenue generated), and the business’s breaks even level of output, which is the point at which a business covers its total costs (ie fixed and variable costs).

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Business Studies Multiple Choice Question – 24 December 2017

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Which ONE of the following is the correct definition of market share?  Select ONE answer:

  1. The total sales of all businesses in a particular market.
  2. The sales of one particular business as a proportion of the total sales in a market.
  3. A group of customers that share a common characteristic.
  4. A part or portion of a business owned by another business or individual.
  5. The share that is taken by large businesses.

 

What is the importance of market share to businesses?
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This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 2 – Market share is the proportion of a market served by a particular brand or business. Gaining market share is classed as a financial (as opposed to non-financial) aim or objective when starting up a business. It cannot be calculated without knowledge of market size, which is summarised in Option A. Option C is a definition of a market segment. Option D is a definition of a ‘share’ in a business.

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Business Studies Multiple Choice Question – 23 December 2017

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Which ONE of the following is NOT an example of a customer need or expectation?  Select ONE answer:

  1. Convenience
  2. Good quality
  3. Limited choice
  4. Value for money
  5. Happiness

What is meant by a business adding value?
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This is multiple choice question is suitable for Business Studies KS4 classes.

The answer is 3 – Customer needs and expectations concern: price – value for money; quality – products/services that are fit for purpose; adequate choice – so that at least one product closely matches each customer’s needs; convenience – products/services that can be quickly and easily accessed.

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Business Studies Multiple Choice Question – 22 December 2017

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

Which TWO of the following is NOT one of the main purposes of business activity?  Select TWO answers:

  1. To add value
  2. To meet customer needs
  3. To raise finance
  4. To produce goods or services
  5. To provide jobs for people

What are the principle sources of finance for start-up businesses?
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This is multiple choice question is suitable for Business Studies KS4 classes.

The answers are 3 and 5 – The main purposes of business activity (and roles of a business enterprise) are to produce goods or services, to meet customer needs and to add value (in order to generate income and wealth for business owners). Finance may need to be raised and jobs may be created in order to fulfill these purposes/roles, but these are not reasons why businesses exist.

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