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Unit 1 definitions Flashcards

0
Q

Adviser

A

An external contact of a business that provides support and advice, sometimes for free

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1
Q

Adding value

A

A process through which a business increases the worth of the resources included in production.

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2
Q

Bank loan

A

A fixed amount loan from a bank which is generally used to finance long-term assets

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3
Q

Bank overdraft

A

Borrowings from a bank on a current account which are payable on demand

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4
Q

Break even

A

The point at which the business is making neither a profit nor a loss. TR=TC

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5
Q

Budget

A

A detailed plan of income and expenses expected over a certain period of time

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6
Q

Business plan

A

A detailed description of a new or existing business, including the company’s strategy, aims and objectives, marketing & financial plan

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7
Q

Cash flow

A

The movements of cash into and out of a business - inflows and outflows

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8
Q

Cash flow forecast

A

A projection, usually by week or month, of the likely cash inflows and outflows in a business

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9
Q

Contribution

A

The difference between total sales and total variable costs

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10
Q

Contribution per unit

A

the difference between selling price per unit and variable cost per unit. P per unit - VC per unit

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11
Q

Costs

A

Outflows of cash of a business as a result of trading

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12
Q

Demand

A

The amount of a product or service that customers are willing and able to pay at a given time

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13
Q

Demographic

A

Defining a market in terms of social-economic factors such as segmentation age, income, class etc

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14
Q

Elasticity of demand

A

The responsiveness of demand to a change in price or incomes

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15
Q

Electronic market

A

A market in which buyers and sellers are brought together using digital means of communication (online)

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16
Q

Enterprise

A

An idea for a business/service

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17
Q

Entrepreneur

A

An individual who sets up and runs a new business and takes on the risks associated with the business

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18
Q

Expenditure budget

A

The budget which estimates the expected costs of a business e.g. Marketing

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19
Q

Fixed costs

A

Costs that do not vary with the level of output e.g. Rent

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20
Q

Franchisee

A

The person or company which operates a franchised business format

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21
Q

Franchisor

A

The owner of a franchise which is licensed out to other people or franchisees

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22
Q

Full-time employee

A

An employees who works more than 30 hours a week in a business

23
Q

Income budget

A

An estimate of the future cash inflows of a business

24
Inputs
The resources, e.g. land, that go into producing goods and services
25
Limited liability
Shareholders are only liable for the money they have invested - not for the overall debts and liabilities of their company
26
Location
The place/places from which a firm does business. Can be both a physical location and also virtual.
27
Margin of safety
The difference between the actual level of output and the break even output
28
Market
Any place where buyers and sellers come together to trade
29
Market growth
The percentage growth in the size of the market, measured over a specific period
30
Market research
The process of planning, collecting, and analysing data relevant to help make marketing decisions
31
Market segmentation
The process of dividing a market into smaller sections which contain customers with similar needs and wants
32
Market share
The share of the total market that is owned by a particular business, product or brand.
33
Market size
The total value or quantity of demand in a specific market over a specific period of time. Measured in units sold
34
Niche market
A smaller part of a larger market in which customers have more specific needs and wants.
35
Opportunity cost
The cost of a decision measured by the benefits of the next best alternative
36
Patent
The right to be the only user/producer of a specific product/process
37
Primary research
The market research that involves the collection of data that does not yet exist
38
Profit
The difference between total sales and total costs
39
Qualitative research
Market research concerned with collecting data on attitudes, opinions, beliefs, intentions etc.
40
Quantitative research
Market research concerned with collecting data that can be quantified - e.g. sales statistics
41
Return
The rewards to enterprise e.g. profit
42
Revenue
The income or sales that a business achieves in a period. | P per unit x quantity sold
43
Risk
The probability or chance that hoped-for outcomes will not occur
44
Sampling
The process of taking and analysing a research sample.
45
Share capital
The finance invested in a business by the shareholders
46
Social enterprise
A business that has objectives other than making profit. Part of a group of organisations in the “not-for-profit” sector
47
Sole trader
A one-person business with unlimited liability for the debts of that business
48
Supplier
A business that provides goods and services to other firms.
49
Total costs
The total of variable and fixed costs in a business
50
Trade credit
Amounts owed to suppliers of a business – a source of finance
51
Trademark
A word, symbol, or phrase used to identify a particular company’s product and differentiate it from other companies’ products
52
Unlimited liability
Describes the potential risk that sole traders and partnerships face. They are liable for the debts of the business
53
USP
Unique selling point - a feature of a product or service that makes it stand out compared with the competition
54
Variable costs
Costs that change with output e.g. Raw materials, power, wages
55
Venture capital
Investment made by specialist funds to finance the launch, early development or expansion of a private company
56
Working capital
The amount of money that a business has available to conduct its day-to-day activities

Business (4 decks)

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