# AQA A2 BUSS3, 13 June 2013 Watch

1. Literally just starting revision now because I have been focusing on Geography and economics! Can anybody please give me some tips or main points that I desperately need to know for tomorrow!
2. (Original post by Kellyy :))
Anyone got any idea what will come up?
Got a feeling it's gonna be ratios as you couldn't use these much in jan!
There's been speculation for the past few pages, look there.
3. I reckon there will be a finance question and an operational 18 markers questions
anyone have any ideas
4. www.thestudentroom.co.uk will be the perfect blog for anyone who wants to know about this subject. You know a lot its practically difficult to argue with you (not that I really would want). You absolutely set a whole new spin on a topic thats been written about for years. Fantastic things, just excellent!
5. (Original post by laurenculver24)
10 marker - Define key word, 2 chunky paragraphs

18 marker - Intro, 2 points, conclusion (Do you add another paragraph? Not sure)

34 marker - Intro, 3 paragraphs (1 F, 2 A or 2 F 1 A), conclusion (recommendation?)

Is this right? I'm kind of confused.
My teacher said to get into the higher marks, you should make 3 points for the 18 markers ( 2 for 1 against, or visa versa).

For the 34 marker, depending on my time im aiming for intro 2/3 for 2/3 against and a conclusion. Not sure if that is too many though.
6. Can anybody tell me what the preferred ratios are?
7. (Original post by maxbillson)
Literally just starting revision now because I have been focusing on Geography and economics! Can anybody please give me some tips or main points that I desperately need to know for tomorrow!
Exam technique is essential for gaining top marks in this exam! Relevant application from the case study with analysis throughout. Also, evaluate at the end of each paragraph as well as the conclusion. I would save 45-50 minutes for Q4 as it's nearly half of the marks allocated in the paper overall! I would recommend the following structure:

Q1 - Definition and the points asked for in the question (usually 2)
Q2 & 3 - Definition with 2 points for and 2 points against as well as a conclusion
Q4 - Definition with 3 points for and 3 points against and a chunky conclusion with recommendations to the proposed strategy
8. Can someone please explain what ARR (average rate of return) means? I get that its the average % of the initial investment that will be regained, but is this each year or over the whole investment period? THANKS!
9. Is there a perfect essay frame for this?

like "point.. this is because...this may lead to... therefore.."

i use this approach for economics but is it ok for business?
10. Anyone got a list of the calculations that we need to know that arn't given to us on the exam paper?
11. Can someone just lay this out for me.

The formulaes i know how to work them out but dont know what they mean.

Current -
Acid -
ROCE -
Asset -
Stock -
Payables - How long it takes to pay suppliers - longer the better
Deliverables - Recieve payments - shorter the better?
Gearing -
Dividend per share -
Dividend yield -

Can you say the ideal figure and whether lower or higher is better thanks.
12. (Original post by emgeesify)
Anyone got a list of the calculations that we need to know that arn't given to us on the exam paper?
Gross profit margin, net profit margin, and investment appraisals (Payback, ARR, and NPV). Think thats all but could be wrong!
13. Incase anyone didn't know, every single year there is always one question on:

Finance
HR
Operations management
Marketing

If you identify each question, like work out which of those it is, then its easier to write your answer because you know what the basis of it is
14. (Original post by rubix1)
Can someone please explain what ARR (average rate of return) means? I get that its the average % of the initial investment that will be regained, but is this each year or over the whole investment period? THANKS!
It's for the whole investment period.
15. Economies of scale confuses me...anyone got a really simple way of explaining it?
16. Current - lower better.
Acid - lower better
ROCE - Higher better
Asset - WHAT DOES ASSET TURNOVER MEAN???!!!
Stock - Higher better, depends on industry
Gearing - Lower better. Up to 50% is ok
DPS - Higher better, doesnt mean much on its own tho
DY - Higher better, entices investment, but means theyre giving out more money which can be bad.
17. The bigger the company the more power they have for negotiations.

If asda anted, they could pay a lower price to X because they buy loads more quantity. But a smaller store has less negotiation power so has to pa higher price. Therfore not able to compete with asda on price.
18. (Original post by Mitche)
Can someone just lay this out for me.

The formulaes i know how to work them out but dont know what they mean.

Current -
Acid -
ROCE -
Asset -
Stock -
Payables - How long it takes to pay suppliers - longer the better
Deliverables - Recieve payments - shorter the better?
Gearing -
Dividend per share -
Dividend yield -

Can you say the ideal figure and whether lower or higher is better thanks.
Current:
Ideal = 1.5:1 or 2:1
However, too much assets means that a business may miss out opportunity to purchase non current assets such as machinery. On the contrary, too low of a value indicates a cash flow problem and therefore may need to delay creditors or raise capital

Acid:
Ideal = 0.75:1 or 1.1
Doesn't consider stock as it's a liquid asset. However, depends upon the nature of the business.

ROCE:
Ideal = High as possible, 10-15% is good, higher than interest rates.

Asset Turnover:
Depends upon the business. Labour intensive = Higher turnover. Capital intensive = Lower turnover. - This is because the capital in a firm is part of its 'net assets'.

Stock Turnover:
Depends upon the business. EG: Selling newspaper needs high stock turnover. Whereas retailers may keep some stock to attract customers.

Payables Days:
Longer the better as it can help with cashflow. But, taking to long effects good will and relationship with suppliers. = Effect trade etc. -- Usually 28 days.

Receivable Days:
Shorter the better. Can be controlled by regularly reminding customers of repayments. However, conflicts between departments as Finance dept want the money back ASAP, whereas Marketing dept may offer credit terms to attract sales.

Gearing:
Low = <25%
High = >50%
But, high gearing attractive when interest rates are low, and whether a company is highly profitable. On the other hand, low gearing reduces the chances of cashflow problems.

Dividend Per Share/Yield:
Higher the better.
19. (Original post by emgeesify)
Economies of scale confuses me...anyone got a really simple way of explaining it?
If big company wants to purchase large stock, the retailer is more likely to give them a discount due to the vast amount of stock they can shift easily

Where-as if it was a small amount of stock it would be more expensive because the supplier doesn't really benefit from selling tiny amounts of stock to a company who doesn't sell as much as a big one therefore not repeating business as much, either

It's basically the reduction of unit cost as the firm gets bigger really. E.G the cost of transportation too as you don't need to buy stock as often
20. (Original post by emgeesify)
Economies of scale confuses me...anyone got a really simple way of explaining it?
Economies of scale are the advantages a firm gains, due to an increase in size. It increases productivity and as a result, unit costs per unit is decreased.

Three main types:
- Technical: Invest in new technology to improve efficiency in production.
- Specialisation: A larger firm can attract and retain skilled workers rather than a smaller firm.
- Purchasing: Power of buyers, benefit from bulk buying from suppliers etc.

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