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Business Paper 1 > Definitions 2 > Flashcards

Definitions 2 Flashcards

1
Q

Private sector

A

Comprises businesses owned and controlled by individuals or groups of individuals

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1
Q

Public sector

A

Comprises organisationsaccountable to and controlled by central or local government

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2
Q

Mixed economy

A

Economic resources are owned and controlled by both private and public sectors

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3
Q

Free-Market economy

A

Economic resources are largely owned by the private sector, with very little state intervention

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4
Q

Command economy

A

Economic resources are owned, planned and controlled by the state

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5
Q

Privatisation

A

The sale of public sector organisations to the private sector

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6
Q

Sole Trader

A

A business that is exclusively owned by one person who has full control and is entitled to all profits(after tax)

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7
Q

Partnership

A

Business formed by two or more people to carry on a business together, with shared capital investment and, usually, shared responsibilities

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8
Q

Primary sector

A

Extraction/production of raw materials from the Earth

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9
Q

Secondary sector

A

Manufacturing and processing, where raw materials are made into products for sale

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10
Q

Tertiary Sector

A

Any business that sells a service or goods

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11
Q

Quarternary sector

A

Refers to services that focus on knowledge

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12
Q

Profit

A

Total financial gain of an organisation. Total Revenue-Total Costs

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13
Q

Revenue

A

Total income generated by sale of a good or service

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14
Q

Four main concepts

A

Sustainability, ethics, change and creativity

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15
Q

System

A

A group of related parts that work together for a purpose

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16
Q

Physical resources

A

Raw materials

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17
Q

Financial resources

A

Funds required to set up and maintain a business

18
Q

4 Processes of Business Management

A

Human resource Management
Finance and accounts
Marketing
Operations

19
Q

HR Management

A

Makes sure the business employs the correct number of skilled employees

20
Q

Operations

A

Plans how and in what quantity goods and services are to be produced

21
Q

Marketing

A

Responsible for ensuring the right product is sold to the right customer for the right price

22
Q

The economy

A

A system for producing and distributing goods and services among people

23
Q

Integrated business

A

A business that involves two or more sectors

24
Q

Business plan

A

A tool used to describe a businesses approach, reduces risk

25
Q

Charity

A

An organisation set up to raise money to help people in need or to support causes that require funding

26
Q

Triple bottom line

A

The three objectives of social enterprises: social, economic, environmental

27
Q

Public corporation

A

A business enterprise owned and controlled by the state

28
Q

Market share

A

Sales of a business as a proportion of total market size in a given period

29
Q

Shareholder value

A

The financial gains recieved by the owners of a company’s shares

30
Q

Ethical code

A

A document detailing a company’s rules and guidelines on staff behaviours that must be followed by all employees

31
Q

STEEPLE

A

Social, technological, economic, environmental, political, legal, ethical

32
Q

Acquisition

A

When a company purchases at least 50% of the shares of another company and becomes the controlling owner

33
Q

Synergy

A

The concept that following an acquisition or merger, the combined value and performance of two businesses will be greater than the sum of two seperate businesses

34
Q

Scale of operation

A

The maximum output that can be achieved using the available inputs

35
Q

Internal economies of scale

A

Reductions in average unit costs of production that result from an increase in the scale of operations of a business

36
Q

External economies of scale

A

Reductions in average unit costs of production of a business. Business enhancing factors that occur outside a company but within the same industry

37
Q

Internal diseconomies of scale

A

Factors that cause average unit costs of production to rise when the scale of business operation is increased

38
Q

External diseconomies of scale

A

Fcators causing average unit costs of production for a bsuiness to rise as an industry expands

39
Q

Multinantional Company

A

A company that operates in more than one company

40
Q

Foreign direct investment

A

Long-term investment by multinational companies in a foreign company

41
Q

Internal sources of finance

A

Money that is raised from the business’s or owner’s existing assets

42
Q

Personal funds

A

The money invested by the owner or owners of a business

43
Q

Retained profit

A

Money that a company has at the end of the trading year after paying all expenses, dividends and taxes. Also a businesses primary source of finance

Business Paper 1 (2 decks)

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