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Business Unit 1 > Definitions > Flashcards

Definitions Flashcards

1
Q

ENTREPENUER

A

A person who takes the risk in starting a new business

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2
Q

ENTERPRISE

A

The creation of a business to meet the needs and wants of customers

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3
Q

RISK

A

The probability that things might not go as well as planned

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4
Q

OPPORTUNITY COST

A

The opportunity cost of a decision is the cost of missing out on an alternative, e.g. Loosing a well paid job to start own business

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5
Q

PATENTS

A
  • difficult to obtain
  • protection for up to 20yrs
  • expensive & time consuming to obtain
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6
Q

TRADEMARKS

A

Something that identifies a product by symbol, name or logo. Protection lasts for up to 10yrs

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7
Q

COPYRIGHT

A

Particularly used in startup creative or knowledge industries. Protection is automatic for any original work. Lasts for 70yrs after authors death.

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8
Q

ADDED VALUE

A

The difference between the price of a finished product and the cost of inputs making it

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9
Q

NICE MARKET SEGMENT

A

A smaller, specialist part of a larger market where customers have particular needs and wants

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10
Q

FRANCHISEE

A

The business which is granted the right to operate a franchise on behalf of the franchisor

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11
Q

FRANCHISOR

A

The ultimate owner of the franchise format

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12
Q

MARKET RESEARCH

A

Information that helps explain the size, structure and nature of a market

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13
Q

QUALITATIVE RESEARCH

A

Provides useful insight into opinions and attitudes of target new customers from relatively little research

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14
Q

QUANTITATIVE RESEARCH

A

Based on proper samples and provides insight based on numerical data

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15
Q

MARKET

A

Is any location where buyers and sellers come together to transact with each other

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16
Q

SOLE TRADER

A

An individual owning the business on their own. They can employ people but those employees don’t have ownership of the business.

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17
Q

PARTNERSHIP

A

Where a business is started and owned by more than one person.

18
Q

PROFIT

A

The difference between total revenues and total costs

19
Q

CONTRIBUTION

A

This is the difference between sales revenue & variable costs of production

20
Q

LOCATION

A

The physical place from which a business is operated and controlled

21
Q

CONTRIBUTION PER UNIT

A

This is the difference between the selling price of one unit and the variable cost of producing one unit

22
Q

BREAK EVEN POINT

A

The output at which total revenues equal total costs

23
Q

CASH FLOW

A

The total cash payments (inflows) into a business minus the total cash payments (outflows)

24
Q

LIQUIDATION

A

This is turning assets into cash and may be insisted on by courts of suppliers haven’t been paid.

25
Q

BUDGETS

A

Financial targets for the future covering revenue (income) and expenditure over a certain time period

26
Q

BANK LOAN

A

A fixed amount loan from a bank which is enter ally used to finance long term assets

27
Q

BUSINESS ANGEL

A

A particular type of investor, usually a successful entrepenuer, who is willing to invest in high-risk, high growth businesses at a very early age

28
Q

ELASTICITY OF DEMAND

A

The responsiveness of demand to a change in price

29
Q

FULL TIME EMPLOYEE

A

An employee who works more than 30 hours a week in a business

30
Q

LIMITED LIABILITY

A

Shareholders are only liable for the money they have invested - not for the overall debts and liabilities of their company

31
Q

MARGIN OF SAFETY

A

The difference between the actual level of output and the break even output

32
Q

MARKET SEGMENTATION

A

The process of dividing a market into smaller sections (segment) which contains customers with similar wants and needs

33
Q

MARKET SHARE

A

The share of a total market that is owned by a particular business, product or brand

34
Q

MARKET SIZE

A

The total value or quantity of demand in a specific market, over a specific period of time. Can be measured in terms of value or quantities

35
Q

QUALITITATIVE RESEARCH

A

Market research concerned with collecting data on attitudes, beliefs, opinion etc

36
Q

QUANTITATIVE RESEARCH

A

Market research concerned with collecting data that can be quantified, e.g. Sales, statistics

37
Q

REVENUE

A

The income or sales that a business achieves in a period

38
Q

RISK

A

The probability or chance that hoped-for outcomes will not occur

39
Q

SUPPLIER

A

A business that provides goods and services to another firm

40
Q

TRADE CREDIT

A

Amounts owed to suppliers of a business

41
Q

UNLIMITED LIABILITY

A

Describes the potential risks that sole traders and partnerships face. They are liable for the debts of the business

42
Q

WORKING CAPITAL

A

The amount of money that a business has available to conduct its day to day activities

Business Unit 1 (2 decks)

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