AQA A LEVEL BUSINESS

KNOWLEDGE BOOK

Student Name:
Contents
3.1 What is Business? 3-8
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3.2 Managers, Leadership & Decision Making 9-13

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3.3 Decision Making to Improve Marketing Performance 14-22

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3.4 Decision Making to Improve Operational Performance 23-29

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3.5 Decision Making to Improve Financial Performance 30-35

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3.6 Decision Making to Improve Human Resource Performance 36-42

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3.7 Analysing the Strategic Position of a Business 43-54

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3.8 Choosing Strategic Direction 55-58

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3.9 Choosing Strategic Methods: How to Pursue Strategies 59-67

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3.10 Managing Strategic Change 68-75

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About this book

The tutor2u AQA A Level Business Knowledge Book provides a comprehensive series of structured, step
by step activities designed to equip students with the essential knowledge they need for their AQA A
Level Business exams.

By working systematically through the book, students will be able to identify gaps in their own
knowledge, whilst building awareness of specialist terminology and familiarity with key concepts,
models and theories which are crucial to exam success.

2 AQA A Level Business Knowledge Book Not to be photocopied

Section 3.1
WHAT IS BUSINESS?
THIS SECTION OF THE SPECIFICATION COVERS:
q Understanding the nature and purpose of business
q Understanding different business forms
q Understanding that businesses operate within an external environment

0 1 GIVE ME THREE…
Business objectives:

1
2
3
Reasons why businesses set objectives:

1
2
3
Reasons why a business has a mission statement:

1
2
3
Examples of variable costs and fixed costs:

VARIABLE COSTS FIXED COSTS

1
2
3

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 0 2 WHAT IS MEANT BY?
Write a definition for the following key terms:

DECISION TREE

UNCERTAINTY

OPPORTUNITY COST

0 3 WHAT’S THE FORMULA?

Write down the formula for calculating:

DECISION TREES: EXPECTED VALUE DECISION TREES: NET GAIN

0 4 BENEFITS AND DRAWBACKS

Identify two benefits and two drawbacks of making decisions based on:

DATA (SCIENTIFIC DECISION-MAKING)

BENEFITS DRAWBACKS

INTUITION (HUNCH)

BENEFITS DRAWBACKS

10 AQA A Level Business Knowledge Book Not to be photocopied

Section 3.3
DECISION MAKING TO IMPROVE
MARKETNG PERFORMANCE
THIS SECTION OF THE SPECIFICATION COVERS:
q Setting marketing objectives
q Understanding markets and customers
q Making marketing decisions: segmentation, targeting, positioning
q Making marketing decisions: using the marketing mix

0 1 GIVE ME THREE…
Marketing objectives:

Internal and external influences on marketing objectives:

INTERNAL INFLUENCES EXTERNAL INFLUENCES

14 AQA A Level Business Knowledge Book Not to be photocopied

 BOSTON PRODUCT
MATRIX

1 4 TELL ME
The value to a business of:

BRANDING

PRODUCT PORTFOLIO
ANALYSIS

THE PRODUCT LIFE CYCLE

NEW PRODUCT
DEVELOPMENT

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 0 2 WHAT’S THE DIFFERENCE?
What’s the difference between:

PROFIT AND PROFITABILITY

PROFIT AND CASH FLOW

CAPITAL STRUCTURE AND CAPITAL INVESTMENT

0 3 WHAT IS MEANT BY?

Write a definition for the following key terms:

ADVERSE VARIANCES FAVOURABLE VARIANCES

BUDGET BREAK-EVEN

0 4 TELL ME
The value to a business of:

BUDGETING

BREAK-EVEN ANALYSIS

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0 5 LABEL THE DIAGRAM
Complete the diagram:

BREAK-EVEN CHART

0 6 WHAT’S THE FORMULA?

Write the formula for calculating:

BREAK-EVEN OUTPUT CONTRIBUTION PER UNIT

MARGIN OF SAFETY TOTAL CONTRIBUTION

32 AQA A Level Business Knowledge Book Not to be photocopied

 0 7 GIVE ME THREE…
Ways of reducing the break-even output of a business:

0 8 WHAT’S THE FORMULA?

Write down the formula for calculating:

GROSS PROFIT GROSS PROFIT MARGIN

PROFIT FROM OPERATIONS PROFIT FROM OPERATIONS MARGIN

PROFIT FOR THE YEAR PROFIT FOR THE YEAR MARGIN

RETURN ON INVESTMENT

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 1 0 GIVE ME THREE…
Benefits of having motivated and engaged employees:

1 1 LABEL THE DIAGRAM

Complete the diagram for Maslow’s Hierarchy of Needs below, AND identify a way in which a business
can achieve each level:

MASLOW’S HIERARCHY OF NEEDS

1 2 WHAT’S THE DIFFERENCE?

What’s the difference between:

TAYLOR & MASLOW’S APPROACH TO MOTIVATING EMPLOYEES

40 AQA A Level Business Knowledge Book Not to be photocopied

HERZBERG’S HYGIENE AND MOTIVATING FACTORS

1 3 TELL ME
The value of theories of motivation:

1 4 IDENTIFY
Identify three methods of financial and non-financial motivation:

METHODS OF FINANCIAL MOTIVATION

3
METHODS OF NON-FINANCIAL MOTIVATION

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 1 5 INFUENCES ON
Identify two influences on:

CHOICE OF FINANCIAL MOTIVATION CHOICE OF NON-FINANCIAL MOTIVATION

1
2

1 6 LIST
Two ways to manage and improve employer-employee relations:

1 7 WHAT IS MEANT BY?

Write a definition for the following key terms:

TRADE UNION WORKS COUNCIL

1 8 TELL ME
The value to a business of:

GOOD EMPLOYEE /
EMPLOYER RELATIONS

42 AQA A Level Business Knowledge Book Not to be photocopied

 1 5 LABEL THE DIAGRAM
Label the diagram below of Bartlett and Ghoshal’s Model of International Strategy:

BARTLETT & GHOSHAL’S MODEL OF INTERNATIONAL STRATEGY

1 6 FOUR FUNCTIONAL AREAS

Identify one impact of internationalisation on each of the following four functional areas:

MARKETING HUMAN RESOURCES

OPERATIONS FINANCE

66 AQA A Level Business Knowledge Book Not to be photocopied

 1 7 WHAT IS MEANT BY?
Write a definition for the following terms:

E-COMMERCE BIG DATA

DATA MINING ENTERPRISE RESOURCE PLANNING

1 8 TELL ME
One reason why a business may be under pressure to adopt digital technology:

The value of digital technology to a business:

1 9 FOUR FUNCTIONAL AREAS

Identify one impact of digital technology on each of the following four functional areas:

MARKETING HUMAN RESOURCES

OPERATIONS FINANCE

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Section 3.10
MANAGING STRATEGIC CHANGE
THIS SECTION OF THE SPECIFICATION COVERS:
q Managing change
q Managing organisational culture
q Managing strategic implementation
q Problems with strategy and why strategies fail

0 1 GIVE ME THREE…
Types of change:

Types of flexible organisation:

0 2 WHAT IS MEANT BY?

In relation to Lewin’s Force Field Analysis model, define:

DRIVING FORCES RESTRAINING FORCES

68 AQA A Level Business Knowledge Book Not to be photocopied

 0 3 BENEFITS AND DRAWBACKS
Identify two benefits and two drawbacks of:

DELAYERING

BENEFITS DRAWBACKS

FLEXIBLE EMPLOYMENT CONTRACTS

BENEFITS DRAWBACKS

0 4 WHAT’S THE DIFFERENCE?

What’s the difference between:

ORGANIIC STRUCTURES AND MECHANISTIC STRUCTURES

KNOWLEDGE AND INFORMATION

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 0 5 TELL ME
The value of change to a business:

The value of a flexible organisation:

0 6 STATE
State Kotter and Schlesinger’s four reasons for resistance to change and the six ways of overcoming
resistance to change:

REASONS FOR RESISTING CHANGE WAYS OF OVERCOMING RESISTANCE TO CHANGE

1. 1.

2. 2.

3. 3.

4. 4.

5.

6.

0 7 STATE
Handy’s 4 classifications of organisational culture:

70 AQA A Level Business Knowledge Book Not to be photocopied