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Business Studies & Economics > Unit 5 Key Terms > Flashcards

Unit 5 Key Terms Flashcards

1
Q

Scarcity of Resources

A

Resources are limited because they are non-renewable.

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2
Q

Economic Problem

A

Unlimited wants and scarce/limited resources which forces us to make choices.

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3
Q

Value

A

How much someone enjoys something, shown by how much they would give up of something else to receive it.

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4
Q

Means of Exchange

A

The method of showing our valuation of something e.g. money.

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5
Q

Opportunity Cost

A

The value of the next best alternative given up when making a choice.

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6
Q

Trade-off

A

The item given up when making a choice.

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7
Q

Revenue

A

The money earned from sales. Selling price x Quantity sold.

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8
Q

Price Sensitivity

A

How sensitive demand is to a change in price.

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9
Q

Substitute (in terms of price sensitivity)

A

A substitute is a product/service you can easily swap to.

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10
Q

Stakeholder

A

An individual or group who has an interest in the actions of a business.

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11
Q

Stakeholder Power

A

Some stakeholders are more influential in the decision making of a business than others.

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12
Q

Conflict of Interest

A

When two or more stakeholders have a different viewpoint on the actions of a business.

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13
Q

Negative Externality

A

The cost inflicted on society as a result of an individuals’ actions that the individual doesn’t pay for.

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14
Q

Positive Externality

A

The benefit inflicted on society as a result of an individuals’ actions that the individual doesn’t get rewarded for.

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15
Q

Measuring Business Success

A

Quantifying the achievements of a business by survival, revenue, profit, market share or ethics.

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16
Q

Competitive Advantage

A

Any factor that helps a business succeed against a rival.

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17
Q

Cash Flow

A

The movement of money in and out of the business.

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18
Q

Gross Domestic Product (GDP)

A

The value of the spending or output, or income in an economy.

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19
Q

Economic Growth

A

An increase in GDP or aspect of GDP.

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20
Q

Inflation

A

An increase in the general level of prices in the economy.

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21
Q

Unemployment

A

The number of people out of work who are actively seeking employment.

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22
Q

Claimant Count

A

A measure of unemployment by counting the number of people claiming unemployment benefit.

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23
Q

Economic Shock

A

An unexpected event that affects the availability and price of resources.

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24
Q

Exchange Rate

A

The value of one currency in terms of another.

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25
Q

Interest Rate

A

The cost/price of borrowing money and the reward for saving.

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26
Q

Taxation

A

Money raised by the government from taking a share of income, spending and profits.

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27
Q

Government Spending

A

Money spent by the government on essential services that wouldn’t be provided by private businesses.

28
Q

Internal Business Growth

A

An increase in the size of a business as a result of a business’ own actions.

29
Q

External Business Growth

A

An increase in the size of a business as a result of the business’ own actions.

30
Q

Merger

A

Where two businesses join forces and begin trading as one.

31
Q

Takeover

A

Where one business buys another and incorporates it into itself.

32
Q

Economies of Scale

A

Where a business benefits from its growth.

33
Q

Diseconomies of Scale

A

Where a business suffers as a result of its growth.

34
Q

Specialisation

A

Focusing on one job role, making it easier to become an expert.

35
Q

Monopoly

A

Where one business dominates the market and has an element of control over it.

36
Q

Natural Monopoly

A

Where market conditions mean that it is in everyone’s best interest for a business to be in a monopoly position.

37
Q

Collusion

A

Where several firms act together to effectively become a monopoly.

38
Q

Competition Commission

A

A government organisation that prevents businesses taking advantage of their position.

39
Q

Pressure Group

A

An organisation set up to influence businesses and/or government to protect stakeholders.

40
Q

GDP per Capita

A

The amount of GDP per person.
How GDP is spread between people in the economy.
GDP divided by population.

41
Q

Standard of living

A

A measure of overall wellbeing or quality of life and of people in the economy. Includes GDP/income but also includes other factors such as life expectancy, crime and literacy etc.

42
Q

Human Development Index

A

A survey/indicator/measurement done by the UN to measure standard of living.

43
Q

Distribution of Income

A

How the income in an economy is spread out/shared/divided up amongst all the people in the economy.

44
Q

Sustainable Growth

A

Level of Economic Growth that meets the needs of current generation without affecting future generations.

45
Q

Renewable Resources

A

Resources that can be recreated at least as fast as they are consumed.

46
Q

Corporate Social Responsibility

A

A policy where businesses exceed/do more than their basic responsibilities.

47
Q

Government Intervention

A

When the government uses tax, subsidies or regulation to influence how businesses behave.

48
Q

Subsidy

A

Money provided by the government as an incentive for businesses to act in a certain way.

49
Q

Self-regulation

A

Where a business voluntarily agrees to follow its own Code of Conduct.

50
Q

Government Regulation

A

Where the government uses laws and punishments to influence how businesses behave.

51
Q

Absolute Poverty

A

Where individuals cannot afford things required for an adequate standard of living.

52
Q

Relative Poverty

A

Where individuals cannot afford things that are part of normal life in their society.

53
Q

Poverty Threshold

A

The amount of income required to achieve an adequate standard of living.

54
Q

Inequality

A

Where there is relative poverty in a country or area.

55
Q

Lesser Economically Developed Country (LEDC)

A

A country that has a relatively low standard of living and lacks the capacity to produce manufactured goods.

56
Q

Trade Barrier

A

A measure used by one country to make it less attractive to import goods from other countries.

57
Q

Tariff

A

A trade barrier that works by putting a tax on imports.

58
Q

quota

A

A trade barrier that works by a limit on the number of items that can be imported.

59
Q

Subsidy (2)

A

A trade barrier that works by supporting domestic producers so that they have competitive advantage over foreign companies.

60
Q

Protectionism

A

Using trade barriers to shield companies in your economy from international competition.

61
Q

Free Trade

A

No barriers to trade between two economies.

62
Q

Single Market

A

A group of economies that agree to act as one larger economy with no restriction of trade between members.

63
Q

Single Currency

A

A way of improving the effectiveness of a single market by removing the trade barrier of currency exchange.

64
Q

The European Union (UN)

A

Europe’s single market.

65
Q

Multinational

A

An organisation that has facilities in more than one country.

66
Q

International Government

A

Organisations that try and co-ordinate individual governments, so that individuals governments act in the best interest of the world.

67
Q

Non-governmental Organisations

A

Not for profit organisations that are set up to promote the interests of a specific stakeholder.

Business Studies & Economics (1 decks)

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