Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Economics Paper 2 > Theme 2 > Flashcards

Theme 2 Flashcards

1
Q

Quality Control

A

Refers to the traditional method of checking that products are of an adequate standard.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Supply Chain

A

The sequence of processes by which a final product is created. Often this involves many different suppliers, perhaps in a range of different locations.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Quality Assurance

A

Means ensuring that quality standards are agreed and met throughout the organisation.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Inorganic growth

A

The firm grows by joining with another firm by merger or takeover.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Boom

A

A time of rapid growth and expansion in the economy.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Emerging economies

A

Have fast growing manufacturing sectors. Some are still poor but others, e.g. Mexico may soon be described as developed.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Globalisation

A

Refers to the increasing interdependence of trading economies with increased imports, exports and capital movement.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Multinational Corporations

A

(MNCs) are businesses that are active in more than one economy.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Viral Marketing

A

Spreads product information from person to person as individuals pass messages on via social media, text or email.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Lead time

A

The time taken from having an idea to selling the product to a customer.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Extension strategies

A

Are ways of lengthening the maturity stage of the product life cycle.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Organic Growth

A

The firm grows from within using its own resources to expand output.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Nominal Value

A

Means that the value is expressed in numerical terms at current price.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Real Value

A

Means that the effect of inflation have been removed. Real value is nominal value minus the inflation rate.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Product Life Cycle

A

The stages a product passes through, from an initial idea to the end of its life.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Depreciation

A

Is a fall in the exchange rate that makes imports dearer and exports cheaper.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

Product Innovation

A

Occurs when a completely new or improved product or service is created.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Employment

A

Refers to all those people of working age who have jobs.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Base Rate

A

Set by the Bank of England and influences interest rates across the economy.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Fiscal policy

A

Adjusts taxation and government expenditure either to stimulate or to cool down the economy.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Efficiency

A

Means organising production so that waste is minimised and costs are the lowest possible.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

Appreciation

A

Occurs when the exchange rate rises, making imports cheaper and exports dearer.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Contractionary policies

A

Slow down economic activity by increasing leakages and reducing injections into the circular flow of money.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

Balance of Trade

A

The difference between exports and imports.

X - M

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

Structural Unemployment

A

Happens when people have the wrong skills for the employment on offer, or are located too far from the available jobs.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

Income elastic

A

Applies to products for which an income change causes a proportionately bigger change in quantity demanded.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

Globalisation

A

Refers to the increasing interdependence of trading economies with increased imports, exports and capital movements.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

Supply-side Policies

A

Designed to increase the productive capacity of the economy by influencing aggregate supply.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

Capital Intensive Production

A

Uses large amounts of capital and relatively little labour.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

Disposable income

A

Amount of income a person can actually spend on goods and services. It measures consumers’ spending power after tax.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

Economies of scale

A

Lead to a reduction in average cost (AC) brought about by an increase in the size of the business.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

Keynes, J.M.

A

The highly influential economist who in the 1930s explained the importance of maintaining levels of aggregate demand during recessions.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

Monopsony Power

A

Occurs when a firm is the only buyer or is big enough to behave like a monopsony. This means that is can drive down the price of inputs simply by refusing to pay more.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
34
Q

Market leader

A

The business with the most control over prices and output within its market.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
35
Q

Invisible

A

Exports and imports cannot be touched or handled; they are services e.g. Insurance, banking or tourism.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
36
Q

Outsourcing

A

Means buying inputs from independent suppliers, or locating the whole production process abroad.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
37
Q

Leakages

A

Reduce the demand for domestically produced goods and services by diverting part of people’s incomes into savings, taxes and spending on imports.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
38
Q

Vertical Integration

A

Means that two businesses in the same industry, but at different stages of the production processes or supply chain, have joined together.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
39
Q

Median income

A

Is the middle value in all incomes, 50% of above it, 50% below it.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
40
Q

Inflation

A

Measured using either the CPI (Consumer Price Index), the headline rate and the basis for the government’s inflation target, or the RPI (Retail Price Index) which includes housing costs e.g. Council tax and mortgage interest payments.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
41
Q

Price Elasticity of Demand

A

The responsiveness of demand to a change in price.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
42
Q

Constant prices

A

Value every year’s output at the price levels of a base year, removing the effects of inflation.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
43
Q

Conglomerate integration

A

Occurs when two businesses that have nothing in common join together.

44
Q

Demand pull inflation

A

Is caused by excess aggregate demand. Quantity demanded exceeds total output.

45
Q

Monopoly

A

Where there is only one firm in the market and no competition.

46
Q

Public Sector Deficits

A

Occur when government spending exceeds tax revenue and it borrows to fund the difference.

47
Q

Investment

A

Is spending now on capital assets that will generate income in the future.

48
Q

Cyclical unemployment

A

Is caused by a downturn in the economic cycle. Spending is falling so output falls and fewer employees are needed.

49
Q

Pricing Strategy

A

The way in which a business decides on the on the price to charge and the factors that influence that decision.

50
Q

Monetary Policy

A

uses interest rates to control the level of spending in the economy.

51
Q

Unemployment

A

Refers to the number of people able and willing to work but not able to find a paying job. The claimant count measures unemployment based on the number of people claiming unemployment benefits. The ILO or LFS measure of unemployment counts all those who are available and looking for work.

52
Q

SME

A

The recognised abbreviation for Small and Medium sized Enterprises.

53
Q

Aggregate Supply

A

The total cost output supplied from all sources in the economy.

54
Q

Promotion

A

The use of advertising, branding, and public relations to increase sales.

55
Q

FDI

A

Foreign Direct Investment

Refers to funds invested in other economies.

56
Q

Free trade areas

A

Are groups of countries that trade completely freely with each other, with no trade barriers, but each member country retains its own independent radar policies in relation to the rest of the world.

57
Q

Total Quality Management

A

(TQM) refers to employees’ being involved in quality control and taking responsibility for the quality of their and their team’s work.

58
Q

Resources

A

CELL

59
Q

Downturn

A

The stage of the economy cycle when the boom slows and the rate of growth of GDP decreases.

60
Q

Process Innovation

A

Occurs when new or improved production methods are used, enhancing efficiency and reducing costs.

61
Q

Oligopoly

A

Occurs when several large firms dominate the market.

62
Q

Takeover

A

When one firm makes a bid for another and secures over 50% of the shares. That firm effectively swallows up the other one.

63
Q

Internal economies of scale

A

Are those that benefit the individual business.

64
Q

Price Inelastic

A

A price change causes a proportionally smaller change in quantity demanded.

65
Q

Micromarketing

A

The marketing of products or services designed to meet the needs of a very small section of the market.

66
Q

Expansionary policies

A

Stimulate the level of economic activity by reducing leakages and increasing injections into the circular flow of money.

67
Q

Mean income

A

The average income, i.e. Total income (GDP) divided by the production.

68
Q

Long tail

A

The mass of niche markets that has vastly extended consumer choice, with small and larger businesses providing for small groups of consumers.

69
Q

Marketing mix

A

The range of marketing strategies that businesses use to promote and sell their products or services. It includes pricing, design and all forms of advertising.

70
Q

External strategies

A

Reduce production costs for all businesses in the industry.

71
Q

Capacity Utilisation

A

Measures actual output as a percentage of maximum theoretical output.

72
Q

Normal Good

A

Any good or service for which quantity demanded rises with incomes and falls when incomes do.

73
Q

Just-in-time

A

(JIT) is a stock control system that does away with the need to hold large quantities of stocks or component inputs.

74
Q

Injections

A

Investment, government expenditure and exports - increase demand for domestically produced goods and services.

75
Q

Consumption

A

Is total household spending on goods and services.

76
Q

Capital

A

Includes all assets that can generate income and includes premises, equipment and financial assets.

77
Q

Labour intensive production

A

Uses large amounts of labour and relatively little capital.

78
Q

Team working

A

Employees are organised into teams that share responsibility for production.

79
Q

Merger

A

The joining together of two or more firms into a single business with the approval of the shareholders and management concerned.

80
Q

Kaizen

A

Is the Japanese word for continuous improvement. It summarises a whole company approach to quality control.

81
Q

Minimum Efficient Scale

A

The lowest point of the average cost curve where all available economies of scale have been put to use.

82
Q

Aggregate Demand

A

The sum total of demand from all sources in the economy.

83
Q

Recovery

A

Follows recession, GDP growth rises slowly at first, then gathers pace. If it then grows faster, it may lead to a boom.

84
Q

Price Elastic

A

A price change causes a proportionally bigger change in quantity demanded.

85
Q

Monopoly Power

A

When a business is big enough to behave like a monopoly and control price or quantity supplied.

86
Q

Economic cycle

A

The fluctuations in the levels and rates of growth of GDP over a period of time. It is sometimes referred to as the trade or business cycle.

87
Q

Synergy

A

Sometimes the combination of two businesses that have merged will yield more than the expected results. Often illustrated as 2+2=5.

88
Q

Human capital

A

Is the knowledge, experience and skills of individuals or of the workforce.

89
Q

Underemployment

A

Refers either to employed people whose work does not make full use of their qualifications or to those forced to take part-time employment.

90
Q

Income inelastic

A

Applies to products for which an income change causes a proportionately smaller change in quantity demanded.

91
Q

Productivity

A

Describes how efficiently resources are actually being used, usually by looking at output per unit of input.

92
Q

Diseconomies of scale

A

Happen when further increases in size begin to increase average costs and inefficiencies develop.

93
Q

Cost-pushing inflation

A

Is caused by rising costs of production.

94
Q

Monopsony

A

Occurs when there is only one buyer of a product or service.

95
Q

Lean production

A

Refers to any system of production that minimises costs through eliminated waste.

96
Q

Inferior good

A

A good or service that sees an increase in demand following a fall in income and a fall in demand following an increase in income.

97
Q

Recession

A

Occurs when there are at least two consecutive quarters of negative growth in GDP.

98
Q

Physical Capital

A

Any buildings, tools and equipment that will help to generate output.

99
Q

Comparative Advantage

A

Refers to the theory that if two countries specialise in the product which for them has the lowest opportunity cost, and then trade, real incomes will rise.

100
Q

BRICs

A 
The developing economies within the world:
Brazil
Russia
India
China
(South Africa)
101
Q

Horizontal integration

A

Means two businesses in the same industry have joined together.

102
Q

Uncertainty

A

Describes a situation where events are unpredictable and beyond the control of the business.

103
Q

Income elasticity of demand

A

Measures the proportionate change in quantity of demand following a change in incomes.

104
Q

Market power

A

Exists when a successful business with a significant market share can influence price and output in the market.

105
Q

Common Markets

A

Have completely free trade internally and a common external trade policy covering the rest of the world.

Economics Paper 2 (1 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions