IGCSE & A LEVELS GUIDE

Lesson Objective: The Meaning of 'An Economy' (2.1) What do you understand by the word 'economy'? What is an 'economy'? An economy is the measure of all the resources and wealth in a country - everything produced and purchased within a country. An economy is the place where business activity happen. An economy is made of businesses in different sectors (the sectors of an economy): The primary sector of an economy is based on activities that extract raw materials from nature (

Chapter 22 - Cash Flow Forecasting and Working Capital Class Objective: To understand the difference between cash and profit Cash is important to business. Fact! Businesses need cash to pay wages, suppliers, utilities, etc... Cash Flow Management, therefore, is a key element of business management. It is the process of making sure that there is enough cash within the company for paying its debts. Think about it... Can a profitable business run out of cash? Can an unprofitable

Chapter 2 - Business Structure Learning Objective: Forms of Business Organization (Ch. 2.2) Before diving in to the different forms of businesses organization we have out there we need to have it clear that there are many legal formalities required by governments to protect investors and lenders: Memorandum of Association: this is where the amount of share capital a company has will be describe and so investors will know the relative importance of a single share. This documen

Chapter 1.2 - Business Activity Learning Objective: Business Activity: Specialization in Providing Goods & Services (1.2) Do you know one thing every business has in common? They all try to add as much value as possible to their products and services! Adding value is increasing the difference between the cost of producing a good/service and the price of selling. Businesses can add value in different ways: 1. The most common way of adding value is through production: turning r

Chapter 2 - Economic Sectors Learning Objective: Structuring an Economy The economy of a country is made of different sectors of its economy: The balance of these sectors in the economies of different countries varies substantially. It depends on the level of industrialization in each country: We now completely understand the different sectors of an economy: primary, secondary, and tertiary. Companies within these different sectors can either be private or public: Most econo

Chapter 19 - Business Finance: Needs and Sources Learning Objective: The Most Common External Sources of Finance (19.2) We shall now discuss external sources of finance: Overdraft: A 'type of short-term loan'; It allows the customer/business to keep on paying its bills even when the account reaches zero; It acts as an emergency; The limit is pre-agreed and therefore it has quick access. It carries interest. Trade Credit: The payment terms offered by suppliers to the business