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Business Studies > Unit 1 > Flashcards

Unit 1 Flashcards

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1
Q

Business

A

Any organisation that uses scarce resources to meet the needs of customers by providing a product or service that they demand

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2
Q

Activity

A

Is the condition in which things are happening or being done

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3
Q

Business activity

A

Provides consumers with goods and services that meet our needs and wants and uses scarce resources

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4
Q

Business plan

A

A written document that describes a business, it’s objectives, strategies, the market it is in and it’s financial forecast

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5
Q

Entrepreneur

A

Someone who takes the financial risk of starting and managing a new venture

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6
Q

Customer

A

An individual consumer or organisation that purchases goods or services from a business

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7
Q

Consumer

A

An individual who purchases goods and services for personal use

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8
Q

Consumer goods

A

The physical and tangible goods sold to consumers that are not for intended resale.
Includes: durable goods - cars, washing machines, and non-durable goods - food and drinks

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9
Q

Consumer services

A

The non-tangible products sold to consumers that are not intended for resale
Includes: hotel accomodation, insurance services, train journeys

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10
Q

Factors of production

A

The resources need by business to produce goods and services.

Includes - land, labour, capital, enterprise

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11
Q

Capital goods

A

The physical goods used by industry to aid in the production of other goods and services
Includes: machines and commercial vehicles

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12
Q

Enterprise

A

The action of showing initative to take the risk to set up a business

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13
Q

Creating (adding) value

A

Increasing the difference between the cost of purchasing bought-in materials and the price the finished goods are sold for (this is the aim)

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14
Q

Added value

A

The difference between the cost of purchasing bought-in materials and the price finished goods are sold for (this is the result)

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15
Q

Branding

A

The process of differentiating a product by developing a symbol, name, image or trademark for it

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16
Q

Opportunity cost

A

The benefit of the next most desired option which is given up (what you don’t get by choosing a different option)

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17
Q

Multinational business

A

A business organisation that has its headquarters in one country, but with operating branches, factories, and assembly plants in other countries

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18
Q

Intrapreneur

A

A business employee who takes direct responsibility for turning an idea into profitable new product

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19
Q

Private limited company

A

A business that is owned by shareholders who are often members of the same family; this company cannot sell shares to the general public

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20
Q

Public limited company

A

A company whose shares are traded on a stock exchange and can be brought of sole by the company

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21
Q

Primary sector

A

Firms engaged in farming, fishing, oil extraction and all other industries that exact natural resources so that they can be used and processed by other firms

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22
Q

Secondary sector

A

Firms that manufacture and process products from natural resources, including computers, baking, cloth making, construction

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23
Q

Tertiary sector

A

Firms provide services to consumers and other businesses, such as retailing, transport, insurance, hotels, tourist

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24
Q

Quaternary sector business

A

Businesses providing information services, such as computing, consultancy, and R&D (research and development)

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25
Public sector
Comprises organisations accountable to and controlled by central or local government
26
Private sector
Comprises business owned and controlled by individuals or groups of individuals
27
Mixed economy
Economic resources are owned and controlled by both private and public sectors
28
Free-market economy
Economic resources that are owned largely by the private sector with very little state intervention
29
Command economy
Economic resources are owned, planned and controlled by the state
30
Public corporation
A business enterprise owned and controlled by the state — also known as a nationalised industry
31
Sole trader
A business in which one person provides the permanent finances and, in return, has full control of the business and is able to keep all of the profits
32
Unlimited liability
Business owners have full legal responsibility for the debts of the business
33
Partnership
A business formed by two or more people to carry on a business together, with shared capital investment and, usually, shared responsibility
34
Limited liability
The only potential loss a shareholder (or owner) has if the business fails is the amount they invested, not their personal wealth
35
Share
A certificate confirming part ownership of a company and entitling the shareholder dividends and certain shareholder rights
36
Initial public offering
An offer to the public to buy shares in a public limited company
37
Shareholder
A person or institution owning shares in a limited company
38
Memorandum of association
This states the name of the company, the address of the head office through which it can be contacted, the maximum share capital for which the company seeks authorisation and the declared aims of the business
39
Articles of association
This document covers the internal workings and control of the business E.G. the names of the directors and the procedures to be followed at meetings will be detailed
40
Co-operative
All members can contribute to the running of the business — workload to decision making. Profits are shared equally among members E.G. Organic valley, co-op, mitre 10
41
Franchise
A business that’s used the name, logo, and trading systems of an existing successful business E.G. McDonald’s, Baskin Robins
42
Franchiser
A person or business that’s sells the rights to open stores and sell products or services using the brand name and brand identity
43
Franchisee
A person or business that buys the right from a he franchiser to operate the franchise
44
Joint venture
Two or more businesses agree to work closely together on a particular project and create a separate business division to do so E.G. BMW, Sony, google earth, samsung
45
Social enterprise
A business with mainly social objectives that reinvests most of its profits into benefiting society rather than maximising returns to its owners
46
Holding company
A business organisation that owns and controls a number of separate businesses, but does not unite them into one unified company
47
Revenue
The total value of sales made during the trading period
48
Capital employed
The total value of all long-term finance invested into the business
49
Market capitalisation
The total value of a company’s issued shares
50
Market share
Sales of the business as a proportion of total market sales
51
Organic (internal) growth
Expansion of a business by means of opening new branches, shop or factories
52
External growth
Business expansion achieved by integrating with another business either by merger or takeover
53
Merger
An agreement by owners and managers of two businesses to bring them together in a new combined business
54
Takeover
When a company buys over 50% of the shares of another company and becomes its controlling owner
55
Horizontal integration
Integration with a business in the same industry and at the same stage of production
56
Vertical integration
Integration with a business in the same industry
57
Forward vertical integration
Vertical integration with a customer business
58
Backward integration
Vertical integration with a supplier business
59
Conglomerate integration
Integration with a business in a different industry
60
Synergy
“The whole is greater than the sum of its parts” Often assumed that the new business will be more successful than the original separate business
61
Strategic alliance
Agreement between two organisations to commit resources to achieving a specific objective while remaining independent
62
Business objective
A stated measurable target that a business plans to achieve
63
Corporate social responsibility
Businesses that consider the interests of society by taking responsibility for the impact of their decisions and activities in customers, employees, communities and the environment
64
Pressure group
Organisations created by people with a common interest or aim, who put pressure on businesses and governments to change policies so that an objective is reached
65
Triple bottom line
The three objectives of social enterprise: Economic, Social, Environmental
66
SMART objectives
Sums that are Specific, Measurable, Achievable, Realistic and Time-limited
67
Business aim
A long term goal that a business hopes to achieve
68
Mission statement
A statement of the business’s core aims, phrased in a way to motivate employees and stimulate interest by outside groups
69
Annual (company) report
A document that gives details of a company’s activities over the year, including it s financial accounts
70
Business strategy
A long term plan of action for a business, designed to achieve a particular ibjective
71
Tactic
A short term action as part of an overall strategy
72
Target
A short term goal that must be reached before an overall objective can be achieved
73
Budget
A detailed financial plan for the future
74
Ethical code (code of conduct)
A document detailing a company’s rules and guidelines on staff behaviours that must be followed by all employees
75
Stakeholders
Individuals or groups of people who can be affected by - and therefore have an interest in - any action by an organisation
76
External stakeholders
Individuals/groups separate from the business but are affected by or interested in its operations E.G. customers, shareholders, suppliers
77
Internal stakeholders
Individuals/groups who work within the business, or own it and are affected by the operations of the business E.G. employees, managers
78
Trade union
An organisation of working people with the objective of improving the pay and working conditions of its members and providing them with support and legal services
79
Stakeholder concept
The view that businesses and their managers have responsibilities to a wide range of groups, not just stake holders (aka stakeholder theory)

Business Studies (6 decks)

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