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Business > Business activity > Flashcards

Business activity Flashcards

1
Q

Need

A

a good or service essential for living

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2
Q

Want

A

a good or service someone would like to have, but is not essential for living

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2
Q

Factors of production

A

land
labour
capital
entrepreneurship

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2
Q

Economic problem

A

unlimited wants but limited resources to produce the goods and services needed to satisfy these wants - leads to scarcity

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3
Q

Scarcity

A

the lack of sufficient products to fulfil the wants of the population

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4
Q

Opportunity cost

A

the next best alternative given up by choosing the other option

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5
Q

Specialisation

A

when people and businesses concentrate on what they’re best at

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6
Q

Division of Labour

A

when production is split up into different tasks and each worker performs one of these the tasks

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7
Q

Businesses

A

combine factors of production to make products to satisfy peoples wants

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8
Q

Primary sector

A

the industry that extracts raw materials from the earth

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8
Q

Added Value

A

the difference between the selling price and the price of brought in materials and production

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9
Q

Secondary sector

A

the industry that manufactures goods using the raw materials

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10
Q

Tertiary sector

A

the industry that provides services to consumers and the other sectors of industry (e.g. transport, hospitals, education)

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11
Q

De-industrialisation

A

when there is a decline in the importance of the secondary industry in a country

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12
Q

Mixed economy

A

has both a private sector and a public sector

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13
Q

Entrepreneur

A

a person who organises, operates and takes the risk for a new business venture

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14
Q

Business Plan

A

a document containing the business objectives and important details about the operations finance and owners of the new business

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15
Q

Capital

A

the money invested into a business by the owner

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16
Q

Capital Employed

A

the total value of capital used in the business

17
Q

Internal growth

A

when a business expands its existing operations

17
Q

External growth

A

when a business takes over or merges with another business

17
Q

Takeover

A

when one business buys out the owners of another business, which then becomes part of the “predator” business

18
Q

Merger

A

when the owners of two businesses agree to join their businesses together to make one business

19
Q

Horizontal integration

A

when one business merges or takes over another in the same industry at the same stage of production

20
Q

Vertical integration

A

when a business merges or takes over another one in the same industry but at a different stage of production

21
Q

Diversification

A

when a business takes over or merges with a business in a different industry

22
Q

Sole trader

A

a business owned by one person

23
Q

Limited liability

A

the liability of shareholders in a company is only limited to the amount they invested

24
Q

Unlimited liability

A

the owner of the business can be held responsible for all debts the business owns, no matter how much they invested

25
Q

Partnership

A

a form of business where 2 or more people agree to jointly own a business

26
Q

Unincorporated business

A

a business that does not have a seperate legal identity (sole traders, partnerships)

26
Q

Partnership agreement

A

a written legal agreement between business partners, it’s not essential but always reccomended

27
Q

Incorporated business

A

companies that have seperate legal status from their owners

28
Q

Shareholders

A

owners of a limited company, they buy shares which represent part ownership of the company

28
Q

Private Limited Companies

A

businesses owned by shareholders, but they cannot sell shares to the public

28
Q

Public Limited Companies

A

businesses owned by shareholders that can sell shares to the public on the stock exchange

29
Q

Annual General Meeting

A

a legal requirement for all companies. shareholders may vote on who they to be on the Board of Directors for the coming year

30
Q

Dividends

A

payments made to shareholders from the profits

31
Q

Franchise

A

businesses bases upon the use of brand names, promotional logos and trading methods of an existing successful business. the franchisee buys the licence to operate the business from the franchisor

32
Q

Joint Venture

A

where two or more businesses start a new project together sharing capital, risk and profits

33
Q

Business objectives

A

the aims / targets that a business works towards

33
Q

Public Corporation

A

a business in the public sector that is owned and controlled by the state / government

34
Q

Profit

A

total income of a business - total costs

35
Q

Market Share

A

the percentage of total market sales held by one brand or business

36
Q

Social Enterprise

A

has social objectives to make a profit to reinvest back into the business

37
Q

Stakeholder

A

any person / group with direct interest in the performance and activities of a business

Business (9 decks)

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