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IGCSE/O'Levels Business Studies (0450/7115) > Unit 1 - Understanding Business Activity > Flashcards

Unit 1 - Understanding Business Activity Flashcards

1
Q

Business Objective

A

Business goals or aims of owners, managers and employees of a business.

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2
Q

Business Stakeholders

A

People and organizations who have interest directly or indirectly in the business and its activities.

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3
Q

Business Plan

A

A document containing the business idea, resources required and how it will be organized to achieve the objectives of the business owners.

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4
Q

Business Target

A

An aim represented by a value or volume set by the business owners to be achieved within a period of time.

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5
Q

Bankruptcy

A

A term used in law to declare that a business is unable to pay its debt.

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6
Q

Capital-Intensive

A

A firm or production process that uses more capital than labour to produce its goods and services.

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7
Q

Consumer

A

People and organizations who are buyers of goods and services.

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8
Q

Consumption

A

The using up of goods and services to satisfy consumer needs and wants.

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9
Q

Creditors

A

Individuals, suppliers and other organizations in which a business owes money to.

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10
Q

Developed Economy

A

A country with an industrialized economy, with a large tertiary sector.

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11
Q

Developing Economy

A

A country rapidly developing its resources to create jobs, increase incomes and living standards through industrialization.

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12
Q

De-Industrialization

A

Developed economies with declining manufacturing activities following a growth in the service sector.

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13
Q

Diversification

A

A business strategy that expands its business activities into different markets and industries by developing a wide variety or range of products and services to reduce the risk of business failure in the event of a fall in demand of any single product or market.

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14
Q

Division of Labour

A

The division of a production process or activity into specialized tasks, that will be completed by a different workers or group of employees.

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15
Q

Enterprise

A

Willingness and ability to start and operate a business while taking considered financial and other business risks.

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16
Q

Entrepreneur

A

A person who is willing and able to take risks and make decisions to organize resources to produce goods and services by starting and operating a business to earn a profit.

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17
Q

Entrepreneurship

A

The process of identifying a business opportunity, organizing the resources to produce goods and services to meet the needs and wants of consumers through business activities to earn profits or sustain a business.

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18
Q

External Growth

A

Expansion of firm through takeovers or mergers with other enterprises.

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19
Q

Firms

A

Organizations that utilizes factors of production to produce goods and services.

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20
Q

Floatation

A

Where shares of a public limited company are available for sale or purchase by the public in a stock exchange for the first time.

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21
Q

Franchise

A

Licensing or agreement between one business organisation and another to use of trademark or brand name of a company to distribute or produce goods or services.

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22
Q

General partner

A

A business partner that has unlimited liability

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23
Q

Going Concern

A

A business that has sufficient financial capability and resources to operate and sustain.

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24
Q

Government Grant

A

Financial aid given by the government to individuals or organisations that meets a particular requirement, to help the government achieve its economic objectives or aim.

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25
Q

Horizontal Integration

A

The establishment of a larger enterprise through merger or takeover between two or more firms within a similar industry at the same stage of production.

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26
Q

Incorporated Business

A

A business organization that has a separate legal identity from its owners.

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27
Q

Internal Growth

A

Expansion by scaling its production or business activity of a firm through more employment or additional factors of production.

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28
Q

Industrial Sector

A

A group of firms specializing in producing certain similar products or using similar production processes.

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29
Q

Industrial Structure

A

The size and importance of different industrial sectors in an economy.

30
Q

Insolvency

A

Describes a business organisation that is unable to pay its short-term debts.

31
Q

Joint-Stock Companies

A

Liimited companies or corporations that are jointly owned by their shareholders.

32
Q

Lateral Integration

A

The takeover or merger of two or more firms from different industries or sectors to form a larger enterprise.

33
Q

Limited Liability

A

The legal responsibility of repaying business debts are limited to the amount of capital invested in the business.

34
Q

Limited Partner

A

A business partner that has limited liability.

35
Q

Liquidity

A

The ability of a business to raise cash from its current assets to repay its short-term debts

36
Q

Liquidation

A

A legal procedure that sells off all remaining assets to pay off the debts of a bankrupt business

37
Q

Manufacturing

A

The process of using natural resources to produce physical goods.

38
Q

Market Share

A

The proportion of total sales of a product or service achieved by a firm.

39
Q

Market Size

A

The total sales revenue for a particular product or service over period of time.

40
Q

Merger

A

Combining two or more firms by the owners to form a larger enterprise.
Mission statement – a statement or declaration of the purpose and objectives of a business organisation

41
Q

Mixed Economy

A

An economy that integrates private and public sectors ownership and allocation of resources to goods and services.

42
Q

Opportunity Cost

A

The lost of benefits of not consuming or producing the next best alternative product.

43
Q

Overstocking

A

A situation whereby a business stores more than adequate quantity of goods or inventory necessary.

44
Q

Over trading

A

When a business accepts more work than it is able to finance and complete too quickly.

45
Q

Partnership

A

When two or more people agree to legally jointly own, finance and operate a business to share its profits

46
Q

Primary Sector

A

Industries that produce or extract natural resources

47
Q

Private Benefits

A

Financial benefits from a business activity

48
Q

Private Sector

A

The sector of the economy owned and operated by private individuals and privately owned businesses.

49
Q

Production

A

Process of using resources to produce goods and services to meet consumer needs and wants.

50
Q

Profit Maximization

A

Choosing resources, production methods, outputs and prices that will earn the most profit to operate the business.

51
Q

Profit

A

Gross profit less expenses

52
Q

Profit

A

A surplus of revenue over costs of production

53
Q

Profitability

A

The ability of a business to generate optimum profit consistently.

54
Q

Public Corporation

A

A government-owned enterprise that functions to provide public services.

55
Q

Public sector

A

That sector of the economy owned and controlled by government and government-owned organizations

56
Q

Revenue

A

Financial amount from sale of goods and services to customers.

57
Q

Secondary Sector

A

Industries such as manufacturing or construction that involves processing natural resources to produce physical goods or infrastructure.

58
Q

Separate Legal Identity

A

A business organization that is legally a separate entity from its owners.

59
Q

Shareholders

A

Owners of limited companies or corporations

60
Q

Social Entrepreneur

A

A person who uses their business skills to start and run a business with the objective of improving social and environmental well-being rather than profit.

61
Q

Social Enterprise

A

A private sector organization with that reinvest most of its profits to grow and meet its social or environmental objectives.

62
Q

Sole Trader

A

A business organization owned and controlled by one person.

63
Q

Specialization

A

Focuses on producing a single or limited range of products to optimize the use of factors of production and resources.

64
Q

Stock market

A

The location where the purchase and sale of new or existing shares (or stocks) in public limited companies can be made.

65
Q

Takeover

A

A firm acquires another firm with or without the agreement of its owners.

66
Q

Tertiary Sector

A

Service industries.

67
Q

Trade Union

A

An organisation setup by employees in a particular workplace or industry to represent them with the aim of advocating and negotiating for better welfare and working conditions such as better wages.

68
Q

Unlimited Liability

A

Legally responsible to repay all debts acquired by the business.

69
Q

Value Added

A

The difference between the price of a product and the cost of the natural and man-made materials, components and resources used to produce it.

70
Q

Vertical integration

A

The establishment of a larger enterprise through merger or takeover between two or more firms at different stages of production of the same product.

71
Q

Mission Statement

A

A statement or declaration of the purpose and objectives of a business organisation.

IGCSE/O'Levels Business Studies (0450/7115) (6 decks)

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