← Business syllabus

EnglandBusiness

3.5 Decision-making to improve financial performance

5 dot points across 5 inquiry questions. Click any dot point for a focused answer with worked past exam questions where available.

How do businesses analyse revenue, costs, profit and break-even?

Calculating and interpreting revenue, fixed and variable costs, contribution and profit, break-even analysis and the margin of safety, and the construction and use of break-even charts.
A focused answer to AQA A-Level Business 3.5, covering revenue, fixed and variable costs, contribution and profit, break-even analysis and the margin of safety, and the construction and interpretation of break-even charts.
11 min answer →

What financial objectives do businesses set and why?

Common financial objectives such as revenue, cost and profit targets, cash flow, return on investment and capital structure, the distinction between cash flow and profit, and the influences on financial objectives.
A focused answer to AQA A-Level Business 3.5, covering common financial objectives such as revenue, cost and profit targets, cash flow, return on investment and capital structure, the difference between cash flow and profit, and the influences on financial objectives.
10 min answer →

How do businesses decide whether an investment is worthwhile?

The methods of investment appraisal (payback period, average rate of return and net present value), how to calculate and interpret each, and the quantitative and qualitative factors in an investment decision.
A focused answer to AQA A-Level Business 3.5, covering the methods of investment appraisal (payback period, average rate of return and net present value), how to calculate and interpret each, and the quantitative and qualitative factors that shape an investment decision.
11 min answer →

How do financial ratios reveal the health of a business?

The purpose of ratio analysis, the calculation and interpretation of liquidity (current ratio), profitability (ROCE), gearing and efficiency ratios, and the value and limitations of ratio analysis.
A focused answer to AQA A-Level Business 3.5, covering the purpose of ratio analysis, the calculation and interpretation of liquidity, profitability, gearing and efficiency ratios, and the value and limitations of ratio analysis for judging performance.
11 min answer →

Where do businesses get the money they need and how do they choose?

Internal and external sources of finance, short-term and long-term finance, the distinction between debt and equity, and how the choice of source depends on cost, risk, purpose and the type of business.
A focused answer to AQA A-Level Business 3.5, covering internal and external sources of finance, short-term and long-term finance, the distinction between debt and equity, and how the choice of source depends on cost, risk, purpose and the type of business.
10 min answer →