IB Docs (2) Team
Quantitative techniques
The IB DP Business Management course (first exams 2024) includes a range of quantitative techniques that you must become familiar with. This applies to both SL and HL students. Quantitative techniques are integral to learning Business Management for numerous reasons, which include the following reasons:
Business Management is essentially about problem solving and decision making. Quantitative techniques can help managers and entrepreneurs to make more informed decisions, based on scientific reasoning rather than intuition.
Completing your internal assessment with quantitative techniques can improve the conclusion and evaluation of the research question.
Similarly, the extended essay tends to reach the higher mark bands if it includes aspects of quantitative analysis; relying only on qualitative techniques can result in an overly descriptive essay.
The questions in the Paper 2 examination are predominantly of a quantitative nature.
The following section lists the quantitative techniques covered in the syllabus. Use the hyperlink to access the notes and resources to fine-tune your understanding and application of these tools and techniques. Click the relevant icon to access the information for each unit of the syllabus.
Please note that not all quantitative techniques require calculations, although they can help to enhance student understanding. Quantitative terms, tools, and techniques that require calculations are indicated by an asterisk (*).
Unit 1 - Introduction to Business Management
Unit 2 - Human resource management
Unit 5 - Operations Management
The Business Management Toolkit (BMT)
There are more than 80 quantitative techniques or key terms in the new syllabus (see the list below). The quantitative techniques for HL only candidates are shown in red italic.
Note that the vast majority of the formulae for the key terms or quantitative techniques below do not appear in the formulae sheet for external assessments (pages 64 - 65 of the guide).
Also, please note that the prescribed formats for the balance sheet, profit & loss account, cash flow forecasts, budgets, and the discount factors (needed to calculate NPV) are not included in the formulae sheet for the external exams.
Absorption costing
Acid test (quick) ratio
Average rate of return (ARR)
Bar charts (descriptive statistics)
Break-even quantity/point
Buffer stock (production planning)
Capacity utilization rate
Capital productivity rate
Closing balance (cash flow forecasts)
Contribution (break-even analysis)
Contribution costing
Contribution per unit (unit contribution)*
Contribution pricing*
Cost to buy (CTB)
Cost to make (CTM)
Cost of sales (COS)
Creditor days (efficiency ratio analysis)
Current assets (balance sheet)
Current liabilities (balance sheet)
Current ratio
Debtor days (efficiency ratio analysis)
Decision trees
Defect rate
Earliest start time (critical path analysis)
Equity or total equity (balance sheet)
Free float (critical path analysis)
Gearing ratio (efficiency ratio analysis)
Gross profit (profit and loss account)
Gross profit margin (GPM)
Labour productivity rate
Labour turnover
Latest finish time (critical path analysis)
Lead time (production planning)
Line of best fit
Loss (break-even analysis)
Make or buy analysis
Margin of safety
Market share
Market growth
Mean (descriptive statistics)
Median (descriptive statistics)
Mode (descriptive statistics)
Net assets (balance sheet)
Net cash flow (cash flow forecasts)
Net current assets (or working capital)
Net present value (NPV)
Non-current assets (balance sheet)
Opening balance (cash flow forecasts)
Operating leverage
Payback period (linear method)
Pie charts (descriptive statistics)
Price elasticity of demand (PED)*
Productivity rate
Profit (balance sheet)
Profit (break-even analysis)
Profit (profit and loss account)
Profit after interest and tax
Profit before interest and tax
Profit before tax
Profit for period (income statement)
Profit margin (mark up)
Profit margin (profitability and liquidity ratio analysis)
Quartiles (descriptive statistics)
Reorder level (production planning)
Reorder quantity (production planning)
Retained profit
Return on capital employed (ROCE)
Sales forecasting
Sales revenue
Standard deviation (descriptive statistics)
Stock turnover ratio
Straight line method of depreciation
Target price (break-even analysis)
Target profit (break-even analysis)
Target profit output (break-even analysis)
Total assets (balance sheet)
Total contribution*
Total costs
Total float (critical path analysis)
Total contribution (break-even analysis)
Total revenue
Total liabilities (balance sheet)
Units of production depreciation rate
Variances (budgets)
Working capital (or net current assets)
* These are not listed as AO4 learning outcomes in the syllabus, although it is anticipated that many teachers will teach students the calculations to support understanding of these terms in the guide.
To gain a better knowledge of each of the 80+ quantitative techniques or key terms in the syllabus, make sure you know and understand the reasons for the correct unit of measurement for each of these. For example, the gross profit margin (GPM) is expressed as a percentage to 2 decimal places.
Have a go at the follow quiz and identify the correct unit of measurement for each given key term / quantitative technique.
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