The key terms associated with market failure: public good, merit good, demerit good, social benefits, external benefits, private benefits, social costs, external costs, private costs. With respect to public goods, merit and demerit goods, external costs and external benefits, abuse of monopoly power and factor immobility. Examples of market failure with respect to these areas only. The implications of misallocation of resources in respect of the over consumption of demerit goods and goods with external costs, and the under consumption of merit goods and goods with external benefits. Note: demand and supply diagrams relating to market failure are not required. Market failure review - PPT Supply and demand review - PPT Questions and suggested solutions doc

5.5.1 Profitability: • The concept and importance of profitability 5.5.2 Liquidity: • The concept and importance of liquidity 5.5.3 How to interpret the financial performance of a business by calculating and analysing profitability ratios and liquidity ratios: • Gross profit margin • Profit margin • Return on Capital Employed • Current ratio • Acid test ratio 5.5.4 Why and how accounts are used: • Needs of different users of accounts and ratio analysis • How users of accounts and ratio results might use information to help make decisions, e.g. whether to lend to or invest in the business Questions and suggested answers

PPT covering: • Basis of business classification, using examples to illustrate the classification • Reasons for the changing importance of business classification, e.g. in developed and developing economies

5.3.1 What profit is and why it is important: • How a profit is made • Importance of profit to private sector businesses, e.g. reward for risk-taking/enterprise, source of finance • Difference between profit and cash 5.3.2 Income statements: • Main features of an income statement, e.g. revenue, cost of sales, gross profit, profit and retained profit • Use simple income statements in decision making based on profit calculations (constructing income statements will not be assessed) *Questions and suggested answers"

Total cost (TC), average total cost (ATC), fixed cost (FC), variable cost (VC), average fixed cost (AFC), average variable cost (AVC). Calculation of TC, ATC, FC, VC, AFC and AVC. Definition, drawing and interpretation of diagrams that show how changes in output affect costs of production. Total revenue (TR) and average revenue (AR). Note: marginal revenue is not required. Calculation of TR and AR. The influence of sales on revenue. Survival, social welfare, profit maximisation and growth. *Unit 3 review Note: marginal cost (MC) not required. Questions with suggested solutions

PPT covering: Characteristics of successful entrepreneurs Contents of a business plan and how business plans assist entrepreneurs Why and how governments support business start-ups, e.g. grants, training schemes

PPT covering: Methods of measuring business size, e.g. number of people employed, value of output, capital employed (profit is not a method of measuring business size) Limitations of methods of measuring business size

Calculation of PED using the formula and interpreting the significance of the result. Drawing and interpretation of demand curve diagrams to show different PED. The key influences on whether demand is elastic or inelastic. The relationship between PED and total spending on a product/revenue, both in a diagram and as a calculation. The implications for decision making by consumers, producers and government. Supply and demand review doc Questions and suggested solutions

3.3.1 Product: • The costs and benefits of developing new products • Brand image; impact on sales and customer loyalty • The role of packaging • The product life cycle: main stages and extension strategies; draw and interpret a product life cycle diagram • How stages of the product life cycle can influence marketing decisions, e.g. promotion and pricing decisions 3.3.2 Price: • Pricing methods (benefits and limitations of different methods), e.g. cost plus, competitive, penetration, skimming, and promotional • Recommend and justify an appropriate pricing method in given circumstances • Understand the significance of price elasticity: difference between price elastic demand and price inelastic demand; importance of the concept in pricing decisions (knowledge of the formula and calculations of PED will not be assessed *Unit 3 review sample questions and answers

Calculation method rather than graph as more relevant to our exam. Tried to keep it as simple as possible. Use titles and sub-titles as prompts to enable class discussions and encourage a deeper learning. You will need to find a previous exam question for the assessment at the end of the session. Thanks for taking the time to view.

Details the constituents of an income statement and balance sheet. Cash statements are not covered. 7 ratios. Worksheet allows for practice with solution.

PowerPoint providing prompts to further learning. Cash flow work sheet.