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Business In The Real World > 1.1 The Purpose And Nature Of Business > Flashcards

1.1 The Purpose And Nature Of Business Flashcards

1
Q

Definition of business

A

A business is an organisation designed to supply a product of service

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2
Q

Definition of product

A

A product is anything that is capable of satifying customer needs and it it tangiable

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3
Q

Definition of service

A

A service is an act that a business person carries out for you in exchange for money, for example:

  • dental treatment
    -accountancy
  • travel agents
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4
Q

Definition of land

A

Land is somewhere to produce the goods e.g. a farm

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5
Q

Definition of labour

A

People to work in the business e.g. farm worker

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6
Q

Defintion of capital

A

Money to get the business started

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7
Q

Definition of enterprise

A

This is the drive or motivation from the owners to start a business

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8
Q

Definition of primary sector

A

Extract raw materials from the earth by digging it up

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9
Q

Definition of secondary sector

A

Manufacturings like bottles and cars

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10
Q

Definition of tertiary sector

A

When products are sold

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11
Q

What is a sole trader?

A

A sole trader is a self-employed person who owns and runs their own business as an individual.

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12
Q

What is a partnership?

A

A partnership is a formal arrangement by two or more parties to manage and operate a business and share its profits.

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13
Q

What is a LTD?

A

A LTD is a limited liability company that is public.

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14
Q

What is a PLC?

A

A PLC is a business that is managed by directors and owned by shareholders.

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15
Q

What is a Not-ForProfit organisation?

A

A Not-For-Profit organisation is a business that aims to do something other than to make profit for the owners, such as providing a public service or helping people.

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16
Q

What is a Companies House?

A

A Companies House ia any limited company or partnership business has to register with Companies House. These records are public and there is usually a fee to register.

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17
Q

What is a Deed of Partnership?

A

A Deed of Partnership is a document that is signed by all of the owners of a business setting out the terms they must abide by and their obligations as owners.

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18
Q

What is Dividends?

A

Dividends is where the average costs (of production, distribution and sales) fall as the business increases the amount of product that it produces, distributes and sells.

19
Q

What is a Grant?

A

A Grant is money given to a business, usually by the government or lottery fund, that does not need to be paid back.

20
Q

What is a Hostile Takeover?

A

A Hostile Takeover is a takeover of one company (called the ‘target company’) by another (called the ‘acquirer’) that is accomplished without the agreement of the target company’s management. Instead, the acquirer approaches the company’s shareholders directly or fights to replace the management to get the takeover approved.

21
Q

What is Income Tax?

A

Income Tax is tax that someone pays based on their personal income (the money that they earn).

22
Q

What is Limited Liability?

A

Limited Liability is when the business owner or owners are only responsible for business debts up to the value of their financial investment in the business.

23
Q

What is profits?

A

Profits is the amount of money made after all costs are deducted.

24
Q

Stock market

A

A centralised market where business shares are traded

25
Q

Economies of sale

A

Where the average costs (of production, distribution and sales) falk as the business increases the amount of product that it produces, distributions and sells

26
Q

Dividends

A

A sum of money paid regularly by a company to its shareholders out of its profits.

27
Q

Deed of partnership

A

A document that is signed by all of the owners of a business setting out the terms they must abide by and their obligations as owners.

28
Q

Companies house

A

Any limited company or partnership business has to register with Companies House. These records are public and there is usually a fee to register.

29
Q

Advantages of sole trading

A
  1. Its quick and easy to set up
  2. Be your own boss make your decisions
  3. You claim all the peofit
  4. Low set up cost
30
Q

Disadvantages of sole trading

A
  1. It has the risk of unlimited liability.
  2. It can involve long work hours and stressful conditions.
  3. There is a high level of responsibility for the owner.
  4. Often the owner performs many different roles in the business.
31
Q

Business survival

A

Is a very common objective for a small business. Business survival refers to keeping the business operating for s certain amount of time. Most businesses initially aim to survive their first year.

32
Q

Market share

A

Refers to the percentage of the market that a business occupies. The market is the industry that a business operates in, for example the fast food industry.

33
Q

Value of shares

A

Is an important aim for a limited company. By increasing the value of the shares, they will keep their shareholders happy.

34
Q

Customer satisfaction

A

Measure how happy a customer is with the products or services provided by the fiem. This is a key objective for firms in a competetive market.

35
Q

Social and Ethical objectives

A

Are linked to doing things in an ethical or environmetally friendly manner, or having a business whose sole purpose is to meet a social need.

36
Q

Profit maximisation

A

Will become the aim of a business once it has reached its break-even point.

37
Q

Growth

A

Can refer to increasing the number of employees, the number of products sold, or increase from sales.Firms may aim to grow domestically (in the same country) or internationally (in other countries).

38
Q

What is a stakeholder?

A

a party that has an interest in a company and can either affect or be affected by the business

39
Q

What is market research?

A

the action or activity of gathering information about consumers’ needs and preferences

40
Q

What is financial forecasts?

A

a framework that presents estimates of past, current, and projected financial conditions

41
Q

What is external pressures?

A

a situation an individual has no control over

42
Q

What is sales and marketing?

A

selling transforms the goods into money, but marketing is the method of serving and satisfying customer needs

43
Q

What is production proccess?

A

a method of using economic input or resources, like labor, capital equipment or land, to provide goods and services to consumers

44
Q

What are human resources?

A

the division of a business responsible for finding, recruiting, screening, and training job applicants

Business In The Real World (2 decks)

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