Definitions Flashcards
Competition
Can be described as rivalry amongst sellers
Market
Is any situation where buyers and sellers are in contact in order to establish price
Market price
Is the price range in a market of which consumers are prepared to pay
Mark up
Is the difference between the cost of producing an item and the price at which it is sold
Monopoly
A market dominated by one seller (CMA say more than 25%)
Competitive market
A market in which there are a large number of sellers. Competition is mainly based on price.
Brand
A distinctive product created by the use of a logo, symbol, name, design, packaging or combination there of
Global brand
Brands that are recognised all over the world
Strategy
A plan of action
Global strategy
Companies that are keen to operate on a global scale must consider how to build a competitive global advantage. I.e. choose the best locations to produce products in
Globalisation
Is the increased integration and interdependence of national economies or the world coming together to trade in each other’s market
Multinational
A business that has activities and operations in more than one country for example McDonalds, Microsoft and Shell
Demand
The amount of a good/service that customers are willing and able to buy at any given price
Supply
The amount of a good/service that sellers are willing and able to sell at any given price
Equilibrium price
The situation in a market where demand is equal to supply I.e. both parties are happy. Customers an but what they want and shops have no unsold stock
Balance of payments/trade
Difference between value of exports and imports
Subsidies and grants
Payments by the government to suppliers that reduce their costs.
Organisational chart
This is a diagram that shows the hierarchy in a business, usually from top to bottom in terms of seniority.
Span of control
The NUMBER of employees from whom a manager is responsible.
Chain of command
The chain of command is concerned with the way in which responsibility for employees is organised within a business.
Delayering
Delayering is the process of reducing the number of levels or layers in an organisation.
Delegation
Where responsibility for carrying out a task or role is passed onto someone else in the business.
Empowerment
Is giving employees the power to do their job, for example the authority to make decisions, plan their own work and solve their own problems.
Market size
Is the number of individuals in a market who are potential buyers of a good/service. Expressed as the collective value of the goods/services that they purchase.
Market growth
Is the percentage growth in the size of the market, measured over a specific period.
Market share
The share of the total market that is owned by a particular business, product or brand.
Market dominance
A measure of market share compared to competitors
Market power
The ability of a firm to influence or control the terms and conditions on which goods are brought and sold.
Barriers to entry
The factors that could prevent a firm from entering and competing in a market
Barriers to exit
The factors that could prevent a firm from leaving a market, even if it wanted to.
Elasticity
Measures how sensitive quantity demanded is to a change in price.
Evaluate
Make a qualitative judgement taking into account different fac
