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Business studies > section one > Flashcards

section one Flashcards

1
Q

need

A

good or service essential for living

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2
Q

want

A

good or service which people would like to have but is not essential for living

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3
Q

economic problem

A

unlimited wants exist but limited resources to produce goods and services

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4
Q

factors of production

A

land labour capital enterprise
resources needed to produce goods and services

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5
Q

scarcity

A

lack of sufficient products to fulfil populations needs and wants

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6
Q

opportunity cost

A

next best alternative given up by choosing another item

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7
Q

specialisation

A

people and the business do what they’re good at

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8
Q

division of labour

A

production process split into different parts and each worker does one of these tasks

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9
Q

business

A

a place where the factors of production are combined to make products

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10
Q

added value formula

A

difference between the selling price and the cost of bought-in materials and other components
Selling price - cost

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11
Q

primary sector

A

extraction natural resource from earth to produce raw materials

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12
Q

secondary sector

A

manufactures goods and services using the raw materials produced in the primary sector

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13
Q

tertiary sector

A

provides services to consumers and the other sectors of the industry

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14
Q

tertiary sector

A

provides services to consumers and the other sectors of the industry

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14
Q

tertiary sector

A

provides services to consumers and the other sectors of the industry

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15
Q

de-industrialisation

A

decline in the importance of secondary sector

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16
Q

mixed economy

A

both private sector and public sector

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17
Q

private sector

A

businesses not owned by government

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18
Q

public sector

A

business owned and controlled by government

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19
Q

capital

A

money invested into a business by the owners

20
Q

entrepreneur

A

person who organises, operates and takes risk for a new business venture

21
Q

capital employed

A

total value of capital used in the business

22
Q

internal growth

A

business expands its existing operations

23
Q

external growth / integration

A

a business takes over or merges with another business

24
Q

takeover

A

business buys out the owners of another business

25
Q

merger

A

owners of two businesses agree to join their business together to make one business

26
Q

horizontal integration

A

one business merges with or takes over another business in the same industry at the same stage of production

27
Q

vertical integration

A

business merges with or takes over another business in the same industry but at a different stage of production

28
Q

conglomerate integration / diversification

A

business merges with or takes over another business in a completely different industry

29
Q

why do some businesses remain small?

A

type of industry the business is in
market size
owners objectives

30
Q

causes of business failure

A

lack of management skills
changes in the business environment
liquidity problems
over expansion

31
Q

sole trader

A

business owned by one person - unlimited liability

32
Q

limited liability

A

liability of the shareholders in a company is limited to only the amount they invested

33
Q

unlimited liability

A

owners of a business can be held responsible for the debts of the business they own
liability not limited to investment

34
Q

partnership

A

form of business in which two or more people agree to jointly own a business

35
Q

unincorporated business

A

does not have a separate legal identity eg. sole traders and partnerships

36
Q

incorporated business

A

companies that have separate legal status from their owners

37
Q

shareholders

A

owners of a limited company. they buy shares which represent ownership of the company

38
Q

private limited companies

A

businesses owned by shareholders but they can’t sell shares to the public- only friends and family

39
Q

public limited companies

A

businesses owned by shareholders but they can sell their shares to the public and their shares are tradable on the stock exchange

40
Q

dividends

A

payments made to shareholders from the businesses profits. return to the shareholders for investing in the company

41
Q

franchise

A

business base uptown the brand names, promotional logos and trading methods of an existing successful business. the franchisee buys the licence to operate this business from the franchisor

42
Q

joint venture

A

where two or more businesses start a new project together, sharing capital, risks and profits

43
Q

public corporation

A

business in the public sector that is owned and controlled by the state government

44
Q

business objectives

A

aims or targets that a business works towards

45
Q

profit

A

total income of a business - total costs
pay a return to shareholders
provide finance

46
Q

marketshare

A

percentage of total market sales held by one brand or business

47
Q

social enterprise

A

social objective as well as aim to make a profit to reinvest back into the business
3 aims- social, environmental, financial

48
Q

stakeholder

A

person or group with a direct interest in the performance and activities of a business

Business studies (7 decks)

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