Today I revised a key topic in Business Studies called Added Value, and I’m sharing my notes + examples for anyone else revising too!
Definition:
Added Value is the difference between the selling price of a product and the cost of the materials used to make it.
Formula:
Added Value = Selling Price – Cost of Inputs
Why It’s Important:
It shows how much extra value a business creates.
More added value = more profit potential.
It helps a product stand out even if it's not the cheapest.
How Can a Business Increase Added Value?
Improve product design
Use better materials
Offer excellent customer service
Promote the product effectively
Lower production cost smartly
Example (from my class):
If a shirt costs Rs. 300 to produce, and it’s sold for Rs. 800,
then the Added Value = Rs. 500.
🎥 Watch: Added Value Explained
My Thoughts:
I used to think value only meant price, but now I understand it's about what makes a product special. This was an easy but interesting topic to start with!
— Sindhya 📝
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