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5565267
A2 Micro Business Growth
Description
Overview of unit 3.1
No tags specified
micro
economics
growth
theory of the firm
economics y13
a2
Mind Map by
Cfo Foster
, updated more than 1 year ago
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Created by
Cfo Foster
over 8 years ago
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Resource summary
A2 Micro Business Growth
Motives
Economies of scale
Restrict competition
Spread risk
Why big firms exist
Economies of scale
High minimum efficient scale (MES)
High barriers to entry
Legal
Physical
Sunk costs
Principle-agent problem
Owners (shareholders)
Long term profits
Managers (Board of directors)
Short term sales
High risk
Collapse of Lehmen Brothers
Methods
Organic
Retained profit
Inorganic
Horizontal merger
Backwards vertical integration
Forwards vertical
Conglomerate
Tata
Constraints
Access to funds
Size of market
Owner objectives
Satisficing
Regulation
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