Subject Specific Vocabulary Flashcards
Define ‘Advertising’
A method of communicating information about the product; the business pays for advertising time/space.
Define ‘aim’
The intention to reach a goal.
Define ‘air pollution’
The presence or introduction of harmful substances into the air causing disease, allergies or damage to humans, animals, plants or the built environment.
Define ‘asset’
Something the business owns; it has a value.
Define ‘average rate of return’
The average profit for the year as a percentage of the original investment. Average rate or return = average return per annum / initial x 100
Define ‘boston matrix’
A tool for analysing the contribution made by each product in a business’ product portfolio. It plots each product’s position according to its market share and the rate of growth of the market.
Define ‘brand image’
The consumers’ perception of the brand; its character, qualities and shortcomings. It is developed over time and operates as a consistent theme through advertising campaigns.
Define ‘break even chart’
A diagrammatic representation of the costs and revenue for a product; it plots total costs against total sales revenue, showing the break-even point where they cross.
Define ‘break even output’
The point at which the business’ total sales equals the total costs. There is neither profit nor loss.
Define ‘buffer stock’
A stock of raw materials held in reserve to protect the production process from unforeseen shortages.
Define ‘business plan’
A detailed statement of how the business intends to operate, either at start-up or during a given period of time. Business plans are based on forecasts and so cover only a short time
Define ‘cash’
Money that the business has in cash or at the bank.
Define ‘cash flow forecast’
A financial planning tool that estimates the money coming into and going out of the business on a month-by-month basis; it allows the business to predict times when additional finance may be needed to maintain liquidity.
Define ‘cash inflow’
Money received by the business from its operations or investments.
Define ‘cash outflow’
Money paid out by the business to fund its operations or investment activities.
Define ‘centralisation’
Maintaining control by keeping authority at the senior levels of the organisation.
Define ‘chain of command’
The line through the hierarchy that shows who is responsible for whom from top to bottom of an organisation.
Define ‘channels of distribution’
The route the ownership of the product transfers from the seller to the buyer; it may be a single transaction or pass through others such as wholesalers, distributors, agents and retailers.
Define ‘closing balance’
The amount that remains in the account at the end of an accounting period.
Define ‘commission’
An amount of money paid to an employee that is based on a percentage of the sales he/she achieved; paid in addition to a basic salary.
Define ‘competition’
The rivalry between businesses looking to sell their goods/services in the same market.
Define ‘competitive pricing’
Setting the price of a product so that it is in line with competitors’ prices.
Define ‘consumer law’
Laws designed to ensure that businesses make products that are safe and of good quality, and that they deal with customers honestly and fairly.
Define ‘consumer spending’
The money spent by households on goods and services to satisfy their needs and wants.
Define ‘contracts of employment’
legal document that sets out the terms and conditions of the job for the employer and the employee.
Define ‘cost’
The money spent by a business on goods and services.
