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Business A-level Edexcel > Theme 3 Key terms > Flashcards

Theme 3 Key terms Flashcards

1
Q

Mission

A

an organisation’s aims and long term intentions, its ultimate purpose.

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2
Q

Mission statement

A

sets out the purpose and primary objectives of a business

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3
Q

SMART objectives

A

specific
measurable
achievable
realistic
time related

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4
Q

Corporate Objectives

A

objectives that relate to the performance of the business as
a whole, which for the focus of business strategy decisions

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5
Q

strategy

A

How the business intends to achieve its objectives

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6
Q

tactics

A

Support achievement of specific targets

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7
Q

Ansoffs matrix

A

marketing planning model that helps a business determine its product and market strategy.

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8
Q

market penetration

A

trying to increase your market share in your existing market

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9
Q

product development

A

selling new products to your existing market

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10
Q

market development

A

selling existing products to new markets

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11
Q

diversification

A

selling new products to new markets

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12
Q

Porters generic matrix

A

identifies a competitive strategy based on competitive advantage and the market

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13
Q

portfolio analysis

A

assesses the position of each product or brand in a firm’s portfolio to help determine the right marketing strategy

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14
Q

boston matrix

A

Stars= high market share, high market growth
Cash cows= low market growth, high market share.
Question marks= low market share, high market growth
dog= low market share, low market growth

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15
Q

competitive advantage

A

an advantage over competitors gained by offering consumers greater value

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16
Q

Distinctive Capabilities

A

something a business is good at that other businesses don’t do

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17
Q

SWOT analysis

A

is a method for analysing a business, its resources, and its environment.

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18
Q

Market conditions

A

relate to the attractiveness of the overall market in which a business operates.

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19
Q

PESTLE

A

assesses the external influences on a business: Political, Economic, Social, Technological, Legal and Environmental

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20
Q

Business cycle

A

all about the rate of change in the value of economic activity.

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21
Q

Gross Domestic Product (GDP)

A

The total measured value of economic activity in an economy,
measured over a particular period.

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22
Q

boom

A

high levels of consumer spending and business confidence

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23
Q

recession

A

falling levels of consumer spending and confidence

24
Q

slump

A

low levels of consumer spending and many business failures

25
Q

recovery

A

increasing levels consumer spending

26
Q

Inflation

A

A sustained increase in the average price level of an economy

27
Q

exchange rate

A

is the price of one currency expressed in terms of another currency.

28
Q

porters 5 forces

A

analyses competition within an industry and judging how attractive the market is

29
Q

Economies of scale

A

arise when unit costs fall as output increases

30
Q

average cost per unit

A

total production costs/ total output x100

31
Q

Internal Economics of Scale

A

arise from the increased output of the business itself

32
Q

External Economies of Scale

A

occur within an industry: i.e. all competitors benefit

33
Q

diseconomies of scale

A

units costs start to rise as output rises

34
Q

Overtrading

A

when a business expands too quickly without having the financial resources to support such a quick expansion.

35
Q

Organic (Internal) Growth

A

involves expansion from WITHIN a business, e.g by expanding the product range, or number of business units and locations.

36
Q

sales forecasting

A

a prediction of future sales based on past data and market research

37
Q

Extrapolation

A

involves the use of trends established by historical data to make predictions about future values.

38
Q

Correlation

A

looks at the strength of a relationship between two variables.

39
Q

Payback period

A

The time it takes for a project to repay its initial investment

40
Q

Average rate of return

A

Looks at the total accounting return for a project to see if it meets the target return

41
Q

Discounted cash flow (NPV)

A

Net present value (“NPV”) calculates the monetary value now of the project’s future cash flows

42
Q

decision trees

A

is a mathematical model that uses tree uses estimates and probabilities to calculate likely outcomes and is used to help managers make decisions.

43
Q

Expected value

A

The financial value of an outcome is calculated by multiplying the estimated financial effect by its probability

44
Q

Net gain

A

The expected value of each outcome less the costs associated with the decision

45
Q

critical path analysis

A

identifies the most efficient and cost effective way of completing a complex project.

46
Q

earliest start time

A

Identifies the earliest time an activity can begin

47
Q

lastest finish time

A

Identifies the latest time an activity can finish without holding up the whole project

48
Q

total float time

A

Total float time = LFT− duration − EST

49
Q

Income statement

A

This measures the business performance

50
Q

Statement of Financial Position (balance sheet)

A

A snapshot of the business’ assets and its liabilities on a particular day

51
Q

Cash flow statement

A

Shows how the business has generated and disposed of cash and liquid funds during a specific period

52
Q

Administration expenses

A

Operating costs and expenses that are not directly related to producing the goods or services

53
Q

Gross profit

A

The difference between revenue and cost of sales.

54
Q

Operating profit

A

records how much profit has been made in total from the trading activities

55
Q

Finance expenses

A

Interest paid on bank and other borrowings

56
Q

Taxation

A

An estimate of the amount of corporation tax that is likely to be payable on the profits for the period.

Business A-level Edexcel (14 decks)

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