Business and Numbers First year

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1. Basic Business Numbers and Calculation
1.1. Numbers and Calculations: can use division to calculate averages, such as the
In business, a solid understanding of fundamental average monthly sales, which involves dividing the
numerical operations is crucial for various tasks, total annual sales by 12. Division is also used to
including financial analysis, budgeting, and decision- determine growth rates, such as the monthly growth
making. This section will cover four primary operations: rate of profit, which is found by dividing the change
addition, subtraction, multiplication, and division, with in profit by the initial profit
a focus on their application in the business world 1.2. Practice:
1. Calculate the total profit for a store that had
a. Additions: is used to calculate the total of two revenues of $15,000 and expenses of $9,000 by using
or more values. In business, you may need to add the addition method.
revenues, expenses, or costs to determine the 2. Determine the average monthly sales for a product
overall financial picture. For instance, you can add that generated $120,000 in revenue over a year
up monthly sales revenues to find the quarterly or through division.
annual total revenue. 3. Find the price per share for a company that has a
EXAMPLE: Calculate the total revenue for a market capitalization of $5 million and 500,000
company that earned 7.500dollars in January, outstanding shares by dividing the market
9.500 in February, and 5000 in March capitalization by the number of outstanding shares.
-Determine the total expenses for a 4. Calculate the percentage increase in profit when it
project by adding up costs like grows from $20,000 to $25,000 by using subtraction
materials,labor,and overhead. and division.
b. Subtraction: is used to find the difference 5. Determine the production cost for 50 units of a
between two values. In business, it's often product if the total cost is $2,500 by using
employed to calculate profit, which is revenue multiplication.
minus expenses. By subtracting expenses from
revenues, you can determine whether a business
is making a profit or incurring losses.
EXAMPLE: Calculate the net profit by
subtracting total expenses from total revenue
-Find the difference between two
consecutive years.
c. Multiplication: is used to calculate the result of
repeated addition. In a business context, you may use
multiplication to find the total cost or total revenue
when you have the cost or price per unit and the
number of units. For example, if each product unit
costs $25, multiplying this by the number of units
produced gives the total production cost.
d. Division: is used to split a value into equal
parts or to find the rate of change. In business, you

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 2. Fractions and Percentages in Business
2.1Working with fractions in Business:
In the business world, fractions are often 2.2Understanding Percentages in Business
encountered when dealing with portions of a whole, : Percentages are ubiquitous in business, representing
such as a share of profit or ownership. proportions, growth rates, and profit margins.
a)-Adding and subtracting Fractures: a-Calculating Percentages: Determine the
- **Adding Fractions**: When you need to combine percentage of a value concerning a total, like
portions, such as when adding up the contributions of calculating the profit margin by finding what portion
different partners in a business venture, you add of the total revenue is profit.
fractions b-Finding percentages in Numbers: Understand
. - **Subtracting Fractions**: To determine the how to find a percentage of a value, such as
difference between portions, like when calculating the determining how much interest is earned on an
decrease in market share, you subtract fractions. investment or how much a discount saves on a
b)- Multplying and Deviding Fractions: purchase.
- **Multiplying Fractions**: Businesses often use c-Increasing and Decreasing Percentages:
fraction multiplication to find proportions or to -**Increasing Percentages**: Know how to
calculate how much is earned or spent, especially calculate percentage increases to evaluate growth, like
when dealing with fractions of a product or cost. a salary increase or revenue growth.
- **Dividing Fractions**: Division is employed when -**Decreasing Percentages**: Calculate percentage
splitting resources or when finding rates and ratios, decreases to assess reductions, such as cost savings or
such as determining how much each investor should profit declines.
receive based on their share of ownership.

3. Quantifying Business Operations with Numbers

3.1 Quantifying Business Operations: salaries, and overhead. Analyzing these numbers
Businesses use numbers to measure, evaluate, and helps identify cost-saving opportunities.
manage various aspects of their operations, providing 3. Profits: The ultimate goal of most businesses is to
a quantitative basis for decision-making. Here's how generate profits. Key financial metrics like gross
numbers are used to quantify key areas: profit margin, net profit margin, and return on
1. Sales: Numbers are essential for tracking sales investment (ROI) provide insights into how efficiently
performance. Businesses use metrics such as total the business is converting revenue into profit.
revenue, sales growth rates, and sales by product or 4. Production: Numbers quantify production output,
region to assess their sales activities and make including the number of units produced, production
informed decisions on pricing, marketing, and costs, and production capacity. These figures are vital
expansion. for optimizing production processes and resource
2. Expenses: Managing expenses is crucial for allocation.
profitability. Companies track expenses in categories
like operating costs, marketing expenses, employee

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3.2 The Role of Key Performance 4. Comparative Analysis: KPIs can be used to
Indicators KPI : benchmark performance over time, compare
KPIs are specific numerical metrics that performance against competitors, or evaluate
businesses use to gauge their performance against key performance in different business units or regions.
objectives and goals. KPIs play a pivotal role in 5. Communication: KPIs serve as a common
tracking business performance because they provide a language for communicating performance across an
clear and quantifiable assessment of how well a organization. When everyone understands the KPIs,
company is achieving its strategic objectives. Here's it's easier to rally teams around shared goals.
how KPIs function: Examples of common KPIs include customer
1. Strategic Alignment: KPIs are directly tied to a retention rates, customer acquisition costs, inventory
company's strategic goals and objectives. For instance, turnover, employee turnover rates, and customer
if a business aims to increase market share, a KPI satisfaction scores. KPIs vary depending on a
might be the percentage of market share gained over a company's industry and strategic priorities.
specific period. 2. Monitoring Progress: Businesses In summary, businesses use numbers to
regularly measure KPIs to monitor their progress. quantify their operations, which includes measuring
This allows them to make timely adjustments to sales, expenses, profits, and production. Key
strategies or tactics if KPIs are not on target. performance indicators (KPIs) play a pivotal role in
3. Data-Driven Decision-Making: KPIs provide a tracking business performance, ensuring that the
data-driven foundation for decision-making. When a business remains aligned with its strategic goals and
KPI shows that a certain aspect of the business is objectives. KPIs provide a data-driven foundation for
underperforming, it prompts management to analyze decision-making, help monitor progress, and facilitate
the situation and take corrective action. effective communication within the organization.

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