Untitled Deck

Question 2

Value of capital employed

Answer 2

The total capital invested into the business.

Question 3

Limitations:

Answer 3

-Some companies might employ a very little amount of capital but might have a large number of employees.

Question 4

Wage

Answer 4

payment for work, usually paid weekly.

Question 5

Brand image

Answer 5

an image or identity given to a product which gives it a personality of its own and distinguishes it from its competitors’ brands.

Question 6

Average cost per unit

Answer 6

the total cost of production divided by the total output.

Question 7

Current liabilities

Answer 7

short-term debts owed by the business.

Question 8

Business

Answer 8

An organisation which produces goods and services.

Question 9

Need

Answer 9

a good or service essential for living.

Question 10

Want

Answer 10

a good or service which people would like to have, but which is not essential for living. People’s wants are unlimited.

Question 12

Economic problem

Answer 12

There exist unlimited wants but limited resources to produce the goods and services to satisfy those wants, this creates scarcity.

Question 15

Scarcity

Answer 15

the lack of sufficient products to fulfil the total wants of the population.

Question 18

Factors of production

Answer 18

those resources needed to produce goods or services. There are four factors of production and they are in limited supply.

Question 21

Franchise

Answer 21

a business based upon the use of the brand names, promotional logos and trading methods of an existing successful business. The franchisee buys the license to operate this business from the franchisor.

Question 25

Department

Answer 25

Areas within the business that are responsible for one important part of the work of the organisation.

Question 28

Delegation

Answer 28

To give authority to a subordinate to preform a task, however the manager is still responsible for the task

Question 31

Sender

Answer 31

the person starting off the process by sending the message.

Question 34

Distribution channel

Answer 34

the means by which a product is passed from the place of production to the customer or retailer.

Question 37

Exchange rate depreciation

Answer 37

the fall in the value of a currency compared with other currencies.

Question 40

(factor of production) Land

Answer 40

all of the natural resources provided by nature, including fields, forests, oil, gas, metals and other resources.

Question 43

(factor of production) Labour

Answer 43

the number of people available to make products.

Question 46

(factor of production) Capital

Answer 46

the finance, machinery and equipment needed for the manufacture of goods.

Question 49

(factor of production) Enterprise

Answer 49

the skill, and risk-taking ability of the person who brings the factors of production together to produce a good or service. For example, the owner of a business. These people are called entrepreneurs.

Question 52

Opportunity cost

Answer 52

the next best alternative given up by choosing another item.

Question 55

Specialisation

Answer 55

when people and businesses concentrate on what they are best at.