Business Studies Multiple Choice Question – 20 January 2022

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

Business Studies
Photo by Andrea Piacquadio on Pexels.com

Nancy owned a corporate events company.

Sales revenue fell and her company failed.

This is an example of?

Select ONE answer:

  1. performance-related pay
  2. an increase in orders
  3. good management of cash flow
  4. changing market conditions

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

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

  1. Not correct – performance related pay is not a factor determining demand for the product/service as it rewards employee performance
  2. Not correct – an increase in orders would increase the chance of the company doing well as demand rose
  3. Not correct – good management of cash flow is more likely to help the business continue as it enables the monitoring of cash flow movements
  4. Correct – Accurate definition of changing market conditions – the factors that alter the supply and demand for goods/services or sales revenue, e.g. price x quantity or business income. Identifies what causes market conditions to change e.g. recession, competitors. Therefore a fall in sales revenue could be due to either a fall in units demanded/sold or a decrease in the selling price of the products/service. Which may mean that Sarah’s business may not be able to cover her costs and therefore fail.

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Author: stuart001uk2014

Referral marketing, business, economics and accounting s​pecialist & corporate mentor

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: