Unit 1 Terms

Question 1

Profit

Answer 1

A business makes a profit when the income earned (revenue) is greater than the cost of production (expenses)

Question 2

Business

Answer 2

A business is an organisation that provides goods and/or services to consumers in order to make a profit

Question 3

Objective

Answer 3

States what an organisation expects to achieve over a set period.

Question 4

Internal environment

Answer 4

Sometimes called the micro environment, includes those factors over which the business has some degree of control

Question 5

External environment

Answer 5

Includes those factors over which the business has little control over which the business has some degree of control. It may further divide into two categories: operating and macro

Question 6

Corporate culture

Answer 6

A set of mostly unwritten or informal rules that spell our how people are to behave most of the time

Question 7

Operating environments

Answer 7

Sometimes called the task environment; refers to the specific outside stakeholders with whom the business interacts in conducting its business

Question 8

Stakeholder

Answer 8

A stakeholder is any group or individual who has an interest in, or its affected by the actions of a business

Question 9

Interest groups

Answer 9

Karl the groups of people who attempt to directly influence or persuade an organisation to adopt particular policies

Question 10

Macro environment

Answer 10

Made up of the broad conditions and trends in the economy and society within which a business operates.

Question 11

Tariff

Answer 11

A tax imposed on imported goods, usually to protect locally produced suppliers of similar items

Question 12

Business ethics

Answer 12

The application of moral standards to business behaviour

Question 13

Socially responsible management

Answer 13

Managing an organisation in such a way that the boarder social welfare of the community is taken into consideration when making business decisions

Question 14

Goodwill

Answer 14

Monetary value attached to the reputation of a particular business

Question 15

Franchise

Answer 15

Buying the rights from another business to distribute its products under its name

Question 16

Asset

Answer 16

Any item of value owned by the business

Question 17

Operating costs

Answer 17

Include those costs involved in the ordinary day to day running of the business

Question 18

Triple bottom line

Answer 18

The Economic, environmental and social performance of a business

Question 19

Performance indicators

Answer 19

Measurable statements birch businesses use to evaluate performance

Question 20

Financial indicators

Answer 20

Found in accounting records and are expressed in dollar terms

Question 21

Non financial indicators

Answer 21

Are commonly expressed in real terms and often makes use of qualitative data

Question 22

Profitability

Answer 22

Measures the earning performance of the business and indicates the businesses ability to maximise profits

Question 23

Liabilities

Answer 23

Items of debt that the business owns

Question 24

Human resource management

Answer 24

The effective management of the formal relationship between the employer and employee

Question 25

Recruitment

Answer 25

Process of attracting qualified job applications by us using advertisements, websites, employment agencies and word of mouth
The most appropriate person will be selected from this

Question 26

Internal recruitment

Answer 26

Filling job vacancies with present employees, rather than looking outside of the business

Question 27

External recruitment

Answer 27

Involves filling job vacancies with people from outside the business

Question 28

Employee selection

Answer 28

Involves gathering information about each applicant for a position, then selecting from that info

Question 29

Permanent employees

Answer 29

Have an employment contract of indefinite duration

Question 30

Fixed term employees

Answer 30

Employed on a contract for a specific period

Question 31

Casual employees

Answer 31

Have contracts with employers for short term

Question 32

Affirmative action

Answer 32

Refers to measure taken to eliminate discrimination in the workplace.

Question 33

Profit organisation

Answer 33

A for profit organisation that has sales income that is greater than the costs of production with the ultimate aim of providing a return to its owners

Question 34

Objective

Answer 34

States what an organisation expects to achieve over a set period of time, it is a specific goal for the business