Nature of Business Flashcards
What is a business ?
A business is any form of commercial activity to satisfy the economic wants of people.
What is the basic needs of an human being ?
1.Food
2.Clothing
3.Shelter
What is bartering ?
Barter is the exchange of one thing for another without the use of money.
What are disadvantages of barter ?
1.Divisibility of goods
2.Storage life (Shelf life)
3.Rate of exchange
4.Double coincidence of wants
What are the advantages of barter ?
1.Get rid of your surplus
2.To be able to exchange something to get something else in return
Why are man refer to as economic animals ?
Man can be describe as economic animals because man (female and male) has to work to earn a wage or salary and that income is then used to provide the needs and wants of human being.
What solved the barter system ?
Money
What is money ?
Money is any object that is generally accepted as payment for goods and services in a given country.
What are the seven characteristics of money ?
- Durable
2.Acceptable
3.Exchangeable
4.Scarce
5.Portable
6.Divisible
7.Homogenous (Standard appearance)
What are the 4 Functions of money ?
1.A medium of exchange
2.A measure of value
3.A store of value
4.A standard for postponed payment
What is a credit card ?
A credit card is a card that allows you to borrow money up to certain limit
What is a debit card ?
A debit card is a card where the bank allows you to access your money from your accounts.
What is economic activity ?
Economic activity are activities that we engaged in to satisfy our basic needs and wants.
What is Direct production ?
Direct production is a situation where a person or group of individuals produces what they need without relying on someone.
What is the bill of exchange ?
A written order used usually in trading which binds one party to pay a fixed sum of money to another party on demanded or predetermine date.
What is documentary credit ?
(The Letters of credit/Documentary credit solve some of the difficulties that occur in international trade and is one of the most secure method in this context)
Documentary credit is a method payment where the buyers’ bank guarantees payment to the seller with conditions that the seller has to fulfil.
What is Electronic fund transfers ?
This is the electronic exchange of money without any paper money changing hands.
What is standing order ?
Standing order is an instruction given to a bank by an account holder to make regular fixed payments to person/organization.
What is Direct debit ?
Direct debit is where an account holder allows someone to withdraw money from their account at regular intervals.
What is Direct deposits ?
Direct deposits is way employers deposits the wages of employees straight in their bank account via EFT.
What is E-commerce ?
E-commerce refers to buying and selling goods and services via the internet.
What is telebanking ?
Telebanking is a service that allows customers to conduct banking via the telephone.
What is cheques ?
Cheques a paper that a bank holder fills out instructing the bank to do something with the money in their account.
What is money order ?
A money order is a printed ,safe form of payment where an account holder can pay a specified sum to someone.
What is bank drafts ?
Bank drafts is form of cheques drawn by a bank on its own funds.
What is telegraphic money transfers ?
Telegraphic money transfers is sending money typically to an oversea destination for someone.
What is internet banking?
Internet banking is a method of banking in which transactions are conducted electronically via internet.
What is m-money ?
(Sometimes referred to as mobile wallet ,m-money)
M-money is an app running on a mobile device that lets users store, send and receive money.(Instead of using cash ,or traditional plastic cards, the user can pay safely using their mobile phones.)
What is a producer ?
Someone who creates goods and services used by individuals and businesses
What is a consumer ?
Is someone who purchases and uses goods and services for their personal use.
What is an organization ?
Is an organized group of people with a particular purpose
What is trade ?
The action of buying and selling goods and services.
What is commodity ?
A raw material or agricultural product that can be bought and sold.
What is speacialisation ?
Is the process of concentrating and becoming an expert in a particular field.
What is market ?
Any situation that brings together the buyer and seller of goods and services.
What is exchange ?
The act of giving one thing and receiving another in return.
What is labour ?
Human metal of physical effort of any kind to produce goods of services.
What is capital ?
Money or any other assets of value that are owned by the business.
The role of a business in the community ?
1.They create job opportunities
2.They get more money circulating in the local economy
3.Encourage Entrepreneurship
4.They build community identity
