Which of the following is a benefit of inorganic growth?
It is often easier to manage and control than organic growth
Market share can be increased very quickly
It can be less expensive than organic growth
Which of the following is a definition of the term ‘a takeover’?
When two or more businesses voluntarily join together
When two businesses work together to design a new product
When one business buys enough shares in another business to control it
What is hiring more staff an example of?
External growth
Internal growth
A merger
Which of the following is a disadvantage of organic growth?
Unit costs can be reduced as the business grows
Growth may be slow
It is often hard to control and manage compared to external growth
What do economies of scale result in?
Lower unit costs
Unchanged unit costs
Higher unit costs
Which of the following is true in relation to sources of finance for growing businesses?
A private limited company can raise finance through the stock exchange
A public limited company can sell shares to fund growth plans
Interest payments have to be made when using retained profit
Which method of growth would most likely reduce the number of businesses that operated in a domestic market?
Expansion overseas
Opening new stores
Takeover of another business in the home country
Which of the following is a benefit of using retained profit as a source of finance to fund business growth?
It does not need to be paid back
The business is at risk of a takeover
Interest is payable on the money borrowed
Selling goods using e-commerce is an example of which method of growth?
Merger
Changing an element of the marketing mix
Takeover
What is an example of an internal source of finance?
Selling shares on a stock exchange
Selling assets
Share capital