End Of Year Revision Flashcards
Limited liability
When the business owners personal possessions are safe as loss is limited
Sole trader
A sole trader is someone who sets up in business on his or her own.
Unlimited liability
Unlimited liability means that the personal possessions of the owners of a business are at risk if there are any problems. There is no limit to the amount of money the owners may have to pay out.
Stakeholders
Stakeholders are individuals and organisations that are affected by, and affect, the activities of a business.
Shareholder
A shareholder is a person or an organisation that owns part of a company. Each shareholder owns a ‘share’ of the business.
Lean production
Lean production is an approach to production that aims to minimise waste.
Total costs
Total costs are fixed costs plus variable costs.
Deed of partnership
an agreement between partners that sets out the rules of the partnership, such as how profits will be divided and how the partnership will be valued if someone wants to leave.
A flotation
occurs when a private limited company (ltd) becomes a public limited company (plc) and has its shares listed on the Stock Exchange.
Customer
someone who buys a product from a business.
Consumer
someone who uses goods and services produced by businesses.
Interest rates
refer to the cost of borrowing money or the reward for saving money, expressed as a percentage.
Gross Domestic Product (GDP)
measures all the income earned in a country’s economy in a year.
Company
a business that has its own legal identity. It can own items, owe money, sue and be sued.
Private sector organisations
are owned by individuals
Public sector organisations
are owned by the government.
Dividends
the financial rewards paid out to shareholders each year.
Negotiation
occurs when two sides discuss what they want and try to reach a solution.
franchisor
sells a franchise usually in return for a fee and percentage of turnover.
franchisee
buys a franchise usually in return for a fee and percentage of turnover.
E-commerce
the act of buying or selling a product using an electronic system such as the internet.
Outsourcing
occurs when a business uses another business to produce for it.
merger
occurs when two or more businesses join together to form a new business
takeover
occurs when one business buys control of another one.
Economies of scale
occur when a business’s unit costs of production fall as its output rises and the business expands.
Diseconomies of scale
when the cost per unit increases as a business expands.
M-commerce
is the buying and selling of products through wireless handheld devices such as smartphone
Ethics
refers to whether a business decision is thought to be morally right or wrong. An ethical decision is made on the basis of what is judged to be morally right.
Non-renewable resources
those of which only a limited amount exists such as coal and oil.
pressure group
a group of people with a common interest who influence public opinion and decisions by businesses and governments.
Environmental responsibility
refers to the taking of decisions by businesses, consumers, governments and other groups with the intention of protecting the environment.
Sustainability
refers to methods of production which can be continued in the long term without damage to the environment.
