Definitions AL Flashcards
Free trade (protectionism)
No restrictions or trade barriers exist that might prevent or limit trade between countries
Tariffs (protectionism)
Taxes imposed on imported goods to make them more expensive
Quotas (protectionism)
Limits on the physical quantity or value of certain goods that may be imported
Voluntary export limits (protectionism)
An exporting country agrees to limit the quantity of certain foods sold to one country (possibly to discourage the setting of quotas/tariffs)
Protectionism
Using barriers to free trade to protect a country’s own domestic industries
Globalisation
The increasing freedom of movement, capital and people around the world
Multinational business
A business organisation that has its headquarters in one country,, but has operating branches, factories and assembly parts in other countries
Privatisation
Selling state-owned and controlled business organisations to investors in the private sector
External growth
Business expansion acheived by means of merging with or taking over another business, from either the same or a different industry, the same sector or different sector
Merger
An agreement by shareholders and managers of 2 businesses to bring both firms together under a common board of directors a with shareholders in both businesses owning shares in the newly merged business
Takeover
When a company buys more than 50% of the shares of another company and so becomes the controlling owner of it AKA acquisition
Su=y Gerry
the idea that ‘the whole is greater than the sum of two parts’- in integration it is often assumed that the new larger business will be more successful that the two formerly separate businesses were
Social audit
A report on the impact a business has on society- this can cover pollution; health and safety record; supply sources; customer satisfaction; etc
Information technology
The use of electronic technology to gather, store, process and communicate information
Innovation
Creating more effective processes, products or ways of doing things in a business
Computer aided design
Using computers and IT when designing products
Computer aided manufacturing
The use of computers and computer-controlled machinery t speed up the production process and make it more flexible
Environmental audits
These audits assess the impact of a business’ activities on the environment
Pressure groups
Organisations created by people with a common interest or aim who put pressure on businesses and governments to change policies so that an objective is reached
Economic growth
An increase in the country’s productive potential measured by an increase in its real GDP
GDP (Gross Domestic Product|)
The total value of goods and services produced in a country in one year- real GDP is this value adjusted to inflation
Business investment
Expenditure by businesses on capital equipment, new technology and research and development
Business cycle
The regular swings in economic activity, measured by real GDP, that occur in most economies, from boom (high demand and rapid growth) to recession (when total national output declines)
Recession
A period of 6 months or more of declining real GDP
Inflation
An increase in the average price level of goods and services - it results in the fall in the value of money
Deflation
A fall in the average price level of goods and services
Cyclical unenmployment
Unemployment resulting from low demand for goods and services in the economy during a period of slow economic growth/ recession
Structural unemployment
Unemployment caused by the decline in important industries, leading to significant job losses in one sector of an industry
Frictional unemployment
Unemployment that results from workers losing or leaving jobs and taking a substantial period of time to find alternative employment
Balance of payments (current account)
This account records the value of trade in goods and services between one country and the rest of the world. A deficit means the value of goods and services imported exceeds the value of goods and services exported
Exchange rate
The price on one country’s currency in terms of another
Fiscal policy
Concerned with decisions about government expenditure, tax rates and government borrowing - these operate largely through the governments annual budget decisions
- expansionary
- contractionary
Government budget deficit
The value of the government spending exceeds revenue from taxation
Government budget surplus
Taxation revenue exceeds the value of government spending
Monetary policy
Is concerned with decisions about the rate of interest and the supply of money to the economy
Market failure
When the market fails to achieve the most efficient allocation of resources and there is under or over production of certain goods and services
External costs
Costs of an economic activity that are not paid for by the consumer or producer, but by the rest of society
Income elasticity of demand
This measure s the responsiveness of demand for a product after a change in consumer incomes.
Percentage change of demand for the product/ percentage change in consumer incomes
Marketing plan
A detailed, fully researched written report on marketing objectives and the marketing strategy to be used to achieve them
Promotional elasticity of demand
Measures the responsiveness of demand for a product following a change in the amount spent on promoting it
Percentage change in demand for the product/ percentage change in promotion spending
Cross elasticity of demand
Measures the responsiveness of demand for a product following a change in the province of another product
Percentage change in demand for good A/ percentage change in price for demand B
New product development (NPD)
The designs creation and marketing of new goods and services
Test marketing
The launch of products on a small scale to test consumer’s reactions to it
Research and development
The scientific research and technician development of new products and processes
Sales forecasting
Predicting future sales levels and sales trends
Sales force composite
A qualitative method of sales forecasting that adds together all of the individual predictions of future sales of all the representatives working for a business
Delphi method
A qualitative long-range forecasting technique that obtains forecasts from a panel of experts
Jury of experts
A qualititative method of sales forecasting which uses the specialists within a business to make forecasts for the future
Globalisation
The growing trend towards worldwide markets in products, capital and labour, unrestricted by barriers
Free international trade
International trade that is allowed to take place without restrictions such as ‘protectionism’ tariffs and quotas
International marketing
The selling of products in markets other than the original domestic market
Pan-global marketing
Adopting a standardised products across the globe as it the entire world were a single market - selling the same goods in the same way everywhere
Global localisation
Adapting the marketing mix, including differentiation products, to meet the national and regional tastes and cultures
Chapter 34
Contents of published accounts
Chapter 32 (Cost centre)
A section of business, such as a department, to which costs can be allocated or charged
E.g. in a hotel: reception; bar; restaurant
Any part of the business where resources are going to be used
Profit centre
Where both money is going to be spent but revenue will also be gained (take resources from the business but also generated profit)
E.g. bar; cantine; papelaria
“A section of a business to which north the costs and revenues can be allocated- so profit can be calculated.”
The 4 types of overheads:
Production overheads
Selling and distribution overheads
Administration overheads
Finance overheads
