Key Terms

Question 1

Autocratic

Answer 1

Management/ leadership style whereby the managers makes all the decisions

Question 2

Adverse variance

Answer 2

A difference between actual and budgeted amounts which is a bad news. Eg higher than budgeted costs

Question 3

Bank over draft

Answer 3

Borrowing money from a bank on a current account, must be able to give back

Question 4

Blake mouton grid

Answer 4

Manager behaviour based on their concern for people and production

Question 5

Boston matrix

Answer 5

Analysis the product portfolio into 4 categories

Question 6

Branding

Answer 6

Differentiates a product or service

Question 7

Break even

Answer 7

Total sales equal total costs, neither a profit or a loss

Question 8

Budget

Answer 8

A detailed plan of income and expenses expected over a certain amount of time

Question 9

Buffer inventory

Answer 9

Minimum level of inventory required

Question 10

Capacity utilisation

Answer 10

Proportion of the total capacity that is used

Question 11

Cash flow

Answer 11

The movement of inflows and outflows of a business

Question 12

Cash flow forecast

Answer 12

Prediction of likely in and out flows

Question 13

Total contribution

Answer 13

The difference between total sales and variable costs

Question 14

Correlation

Answer 14

The relationship between two variables

Question 15

Delegation

Answer 15

where the responsibility of doing something is being passed on to someone else in the business

Question 16

Democratic

Answer 16

Managers involve the employees in the decision making

Question 17

Distribution channel

Answer 17

How a business gets its products to the end customer

Question 18

Dividend

Answer 18

A payment that is made by a company to its shareholders from the profit

Question 19

Elasticity of demand

Answer 19

Responsiveness of demand to change in price

Question 20

Extrapolation

Answer 20

Using previous data to predict future values

Question 21

Favourable variance

Answer 21

A difference between actual and budgeted results which is good news

Question 22

Gross profit

Answer 22

Revenue minus cost of sales

Question 23

Hierarchy

Answer 23

The structure and the number of layers of management and supervision in an organisation

Question 24

Inventory control

Answer 24

The process and controls used by a business to ensure that it has sufficient inventory for its purposes

Question 25

Job design

Answer 25

The way in which taste are combined to form a job

Question 26

Limited liability

Answer 26

Shareholders are only liable for he money that have invested

Question 27

Lean production

Answer 27

A method of products that aims to reduce waste

Question 28

Margin of safety

Answer 28

Difference between actual level of out put and break even point

Question 29

Market capitalisation

Answer 29

The value of outstanding shares

Question 30

Market research

Answer 30

The process f planning, collecting, and analysing data relevant to help make marketing decision

Question 31

Market segmentation

Answer 31

The process of dividing a market into smaller sections which contain customers with similar needs and wants

Question 32

Market share

Answer 32

The share of a the total market that is owned by a particular business product or bran

Question 33

Marketing mix

Answer 33

What they use to pursue its marketing objectives | 7 Ps

Question 34

Mass customisation

Answer 34

The ability to offer products designed for he individual on a large scale

Question 35

Mass market

Answer 35

Describes the largest group of customers

Question 36

Niche market

Answer 36

Focuses on a segment or a larger market sector Whig is possible to target

Question 37

Operating profit

Answer 37

Gross profit minus admin costs

Question 38

Opportunity cost

Answer 38

The cost of a decision as measured by the benefits of the next best alternative

Question 39

Outsourcing

Answer 39

The deletion of business processes to a third party

Question 40

Penetration pricing

Answer 40

Pricing strategy that involves the setting of lower, rather than higher prices in order to achieve a large market share

Question 41

Price skimming

Answer 41

Pricing strategy where a higher price is charged for a new product to take advantage of customers prepared to pay for innovation

Question 42

Product life cycle

Answer 42

A theory which predicts the stages a product goes through from introduction to withdrawal from a market

Question 43

Profitabilities

Answer 43

The ability of the business to generate profit from its activities

Question 44

Quality

Answer 44

Where the product meets the customers requirements

Question 45

Spare capacity

Answer 45

Where a business is able to produce more with existing resources

Question 46

Stakeholder

Answer 46

A person or group with an interest with the business

Question 47

Tannenbaum and Schmidt continuum

Answer 47

A model of leadership that examines the relationship between how much freedom a manger gives he workers and how much auto tutu is retained

Question 48

Trade union

Answer 48

An organisation made up of employees who work together to improve working conditions

Question 49

Variance

Answer 49

The difference between the budgeted amount and what actually happens, it can be favourable or adverse

Question 50

Venture capital

Answer 50

Investment made by specialist funds to finance the launch, early development or expansion of a private company

Question 51

Waste

Answer 51

A cost of production

Question 52

Working capital

Answer 52

The amount of money that a business has available