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Business studies (A levels) > Unit Definitions > Flashcards

Unit Definitions Flashcards

1
Q

Consumer goods:

A

the physical and tangible goods sold to the public

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2
Q

Consumer services

A

the non-tangible products sold to the general public

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3
Q

Capital goods

A

the physical goods used by industry to aid in the production of other goods and services

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4
Q

Added value

A

the difference between the cost of purchasing the raw materials and the price the finished products are sold for

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5
Q

Entrepreneur

A

someone who takes the financial risk of starting and managing a new venture

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6
Q

Social enterprise:

A

a business that reinvests most of its profits into benefiting society rather than maximizing the returns to owners

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7
Q

Triple bottom line

A

the three objectives of social enterprises – economic, social and environmental

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8
Q

Private sectors

A

businesses owned and controlled by individuals or groups of individuals

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9
Q

Public sector

A

organisations accountable to and controlled by central or local government

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10
Q

Mixed economy

A

economic resources are owned and controlled by both private and public sector

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11
Q

Free-market economy

A

economic resources owned largely by the private sector with little or no government intervention

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12
Q

Command economy

A

economic resources owned, planned and controlled by the state

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13
Q

Sole trader

A

a business where one person provides the permanent finances and in return gets full control of the business

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14
Q

Partnership

A

a business formed by two or more people that share the capital and responsibility

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15
Q

Private limited company

A

a small to medium sized business that is owned by shareholders who are often friends or members of the sae family. They cannot sell shares to the general public

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16
Q

Shareholder

A

a person or institution owning shares in a limited company

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17
Q

Public Limit Company:

A

a large business that has the right to sell shares to the general public on the stock exchange

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18
Q

Memorandum of Association

A

this states the name and all its contact details

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19
Q

Articles of Association

A

this document covers the internal workings and control of the business

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20
Q

Franchise

A

a business that uses the name, logo and trading system of an existing successful business

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21
Q

Joint venture

A

two or more businesses agree to work closely together on a particular project and create a separate business division to do so

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22
Q

Holding company

A

a business organisation that owns and controls a number of separate businesses

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23
Q

Public corporation

A

a business enterprise owned and controlled by the state also known as nationalised industry

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24
Q

Privatisation

A

selling state-owned and controlled business organisations to investors in the private sector

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25
Q

Public-private partnerships (PPP)

A

these are government services or business ventures that are funded and managed through a partnership of government and one or more private-sector companies

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26
Q

Free trade

A

no restrictions or trade barriers exist that might prevent or limit trade between countries

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27
Q

Tariffs

A

taxes imposed on imported goods to make them more expensive than they would otherwise be

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28
Q

Quotas

A

limits on physical quantity or value of certain goods that may be imported

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29
Q

Voluntary export limits

A

an exporting country agrees to limit the quantity of certain goods sold to one country

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30
Q

Protectionism

A

using barriers to free trade to protect a countries own domestic industries

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31
Q

Globalisation:

A

the increasing freedom of movement of good, capital and people around the world

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32
Q

Multinational business

A

a business organisation that has its headquarters in one country but has operating branches, factories or assembly parts in other countries

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33
Q

Sales turnover:

A

total value of sales made by a business in a given period of time

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34
Q

Capital employed

A

the total value of all long-term finance invested in the business

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35
Q

Market capitalisation

A

the total value of a company’s issued shares

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36
Q

Market share

A

sales of the business as a proportion of total market sales

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37
Q

Internal growth

A

expansion of a business by means of opening new branches, shops or factories

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38
Q

External growth

A

: business expansion achieved by means of merging with or taking over another business, from either the same or different industry

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39
Q

Horizontal integration

A

integration with firms in the same industry and at the same stage of production

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40
Q

Vertical integration – forward

A

integration with a business in the same industry but a customer of an existing business

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41
Q

Vertical integration – backward

A

integration with a business in the same industry but a supplier of an existing business

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42
Q

Conglomerate integration

A

integration with a business in a different industry

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43
Q

Merger

A

an agreement by shareholders and managers of two businesses to bring both firms together under a common board of directors with shareholders of both businesses owning shares in the newly merged business

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44
Q

Takeover

A

when a company buys over 50% of the shares of another company and becomes the controlling owner of it

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45
Q

Synergy

A

the whole is greater than the sum of parts, therefore within integration, the new business will be better then what the two businesses were apart

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46
Q

Mission statement

A

a statement of the business’s core aims, phrased in a way to motivate employees and to stimulate interest by outside groups

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47
Q

Corporate social responsibility

A

the business considers the interest of society by taking responsibility for the impact of their decisions and activities on customers, employees, communities and the environment

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48
Q

Management by objectives

A

a method of coordinating and motivating all staff in an organisation by dividing its overall aim into specific targets for each department, manager and employee

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49
Q

Ethics

A

are the moral guidelines that determine decision making

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50
Q

Ethical code (code of conduct)

A

a document detailing a company’s rules and guidelines on staff behaviour that must be followed by all employees

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51
Q

Stakeholders:

A

people or groups of people who can be affected by, and therefore have an interest in any action by an organisation

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52
Q

Stakeholder Concept

A

the view that businesses and their managers have responsibilities to a wide range of groups, not just shareholders

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53
Q

Social Audit

A

a report on the impact a business has on society. It covers pollution levels, health and safety, sources of supplies, customer’s satisfaction and contribution to the community

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54
Q

Monopoly

A

where there is one supplier to a market

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55
Q

Information Technology

A

the use of electronic technology to gather, store, process and communicate information

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56
Q

Computer-aided design

A

using computers and IT when designing products

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57
Q

Computer-aided manufacturing

A

the use of computers and computer controlled machinery to speed up the production process and make it more flexible

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58
Q

Environmental audits

A

assess the impact of a business’s activities on the environment

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59
Q

Pressure group

A

organisations created by people with a common interest or aim who put pressure on business and governments to change policies so that an objective is reached

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60
Q

Gross domestic product (GDP)

A

the total value of goods and services produced in a country in one year

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61
Q

Economic growth

A

an increase in a country’s productive potential measured by an increase in its real GDP

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62
Q

Business Investment

A

expenditure by businesses on capital equipment, new technology and research and development

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63
Q

The business cycle

A

the regular swings in economic activity which is measured by real GDP. It includes Boom, Recession, Slump and Recovery

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64
Q

Inflation

A

an increase in the average price level of goods and services. Results in a fall of the value of money

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65
Q

Deflation

A

a fall in the average price level of goods and services

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66
Q

Unemployment

A

when members of the working population are willing and able to work, but are unable to find a job

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67
Q

Working population

A

all those of age who are willing and able to work

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68
Q

Cyclical unemployment:

A

unemployment resulting from low demand for goods and services in the economy during a period of slow economic growth or a recession

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69
Q

Structural unemployment

A

unemployment caused by the decline in important industries, leading to significant losses in one sector of industry

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70
Q

Frictional unemployment:

A

unemployment resulting from workers losing or leaving jobs and taking a substantial period of time to find alternative employment

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71
Q

Balance of payments

A

this account records the value of trade in goods and services between one country and the rest of the world. A deficit means that the value of goods and services imported exceeds the value of goods and services

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72
Q

Imports

A

goods and services purchased from other countries

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73
Q

Exports

A

goods and services sold to consumers and business in other countries

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74
Q

Exchange rate:

A

the price of one currency in the terms of another

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75
Q

Exchange rate depreciation

A

a fall in the external value of a currency as measured by its exchange rate against other currencies

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76
Q

Fiscal policy

A

is concerned with decisions about government expenditure, tax rates and government borrowing

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77
Q

Government budget deficit

A

the value of government spending exceeds revenue from taxation

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78
Q

Government budget surplus

A

taxation revenue exceeds the value of government spending

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79
Q

Monetary policy

A

is concerned with decisions about the rate of interest and supply of money in the economy

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80
Q

Market failure

A

when markets fail to achieve the most efficient allocation of resources and there is under or over production of certain goods and services

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81
Q

External costs

A

costs of an economic activity that are not paid for by the producer or consumer but by the rest of society

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82
Q

Income elasticity of demand

A

measures the responsiveness of demand for a product after a change in consumer income

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83
Q

Manager:

A

responsible for setting objectives, organising resources and motivating staff so that the organisations aims are met

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84
Q

Leadership

A

the art of motivating a group of people towards achieving a common objective

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85
Q

Autocratic leadership

A

a style of leadership that keeps all decision making at the centre of the organisation

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86
Q

Democratic leadership

A

a leadership style that promotes the active participation of workers in taking decisions

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87
Q

Laissez – faire leadership

A

a leadership style that leaves much of the decision making to the workforce

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88
Q

Paternalistic leadership

A

a leadership style based on the approach that the manager is in a better position than the workers to know what is best for an organisation

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89
Q

Informal leader

A

a person who has no formal authority but has respect of colleagues and some power over them

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90
Q

Emotional intelligence (EI)

A

the ability of managers to understand their own emotions and those of the people they work with to achieve better business performance

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91
Q

Motivation:

A

the internal and external factors that stimulate people to take actions that lead to achieving a goal

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92
Q

Self-actualisation

A

a sense of self—fulfilment reached by feeling enriched and developed by what one has learned and achieved

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93
Q

Job enrichment

A

aims to use the full capabilities of workers by giving them the opportunity to do more challenging and fulfilling work

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94
Q

Motivating factors (Motivators)

A

): aspects of a workers job that can lead to positive job satisfaction such as achievement, recognition, meaningful and interesting work and advancement at work

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95
Q

Hourly wage rate

A

payment to worker made for each hour worked

96
Q

Piece rate

A

a payment to a worker for each unit produced

97
Q

Salary

A

: annual income that is usually paid on a monthly basis

98
Q

Commission

A

a payment to a sales person for each sale made

99
Q

Performance-related pay

A

a bonus scheme to reward staff for above average work performance

100
Q

Profit sharing

A

a bonus for staff based on the profits of the business

101
Q

Job rotation

A

increasing flexibility of workforce and the variety of work they do by switching from one job to another

102
Q

Job enlargement

A

: attempting to increase the scope of a job by broadening or deepening the task undertaken

103
Q

Quality circles

A

they are voluntary groups of workers who meet regularly to discuss work-related problems and issues

104
Q

Worker participation

A

workers are actively encouraged to become involved in decision making within the organisation

105
Q

Team working

A

production is organised so that groups of workers undertake complete units of work

106
Q

Human resource management (HRM)

A

the strategic approach to the effective management of an organisation’s workers so that they help the business gain a competitive advantage

107
Q

Workforce planning

A

analysing and forecasting the numbers of workers and the skills of those workers that will be required by the organisation to achieve its objectives

108
Q

Workforce audit:

A

a check on the skills and qualifications of all existing workers/managers

109
Q

Recruitment:

A

the process of identifying the need for a new employee, defining the job to be filled and the type of person needed to fill it, attracting suitable candidates for the job and selecting the best one

110
Q

Job description

A

a detailed list of the key point about the job to be filled, stating all its key tasks and responsibilities

111
Q

Person specification

A

a detailed list of the qualities, skills and qualifications that a successful applicant will need to have

112
Q

Staff appraisal

A

: the process of assessing the effectiveness of an employee judged against pre-set objectives

113
Q

Employment contract

A

a legal document that sets out the terms and conditions governing a workers job

114
Q

Dismissal

A

being dismissed from a job due to incompetence or breach of discipline

115
Q

Unfair dismissal

A

: ending a workers employment contract for a reason that the law regards as being unfair

116
Q

Redundancy

A

when a job is no longer required, therefore the employee’s skills are no longer required

117
Q

Temporary employment contract

A

employment contract that lasts for fixed time period

118
Q

Part-time employment contract

A

employment contract this is for less than the normal full working week

119
Q

Flexi-time contract

A

employment contract that allows staff to be called in at times most convenient to employers and employees

120
Q

Outsourcing

A

not employing staff directly but by using an outside agency

121
Q

Teleworking

A

staff working from home but keeping contact with the office by means of modern IT communication

122
Q

Hard HRM

A

an approach to managing staff that focuses on cutting costs

123
Q

Soft HRM

A

: an approach to managing staff that focuses on developing staff so that they reach self-fulfilment and are motivated to work hard and stay with the business

124
Q

Labour productivity

A

the output per worker in a given time period: total output in time period / total staff employed

125
Q

Absenteeism

A

measures the rate of workforce absence as a proportion of the employed total: no. of staff absent / total no. of staff x 100

126
Q

Labour turnover

A

: measures the rate at which employees are leaving an organisation: number of staff leaving in time period / average no. of staff employed x 100

127
Q

Trade union

A

an organisation of working people with the objective of improving the pay and working conditions of their members and providing them with support and legal services

128
Q

Conciliation

A

the use of a third party in industrial disputes to encourage both employer and union to discuss an acceptable compromise solution

129
Q

Arbitration

A

resolving an industrial dispute by using an independent third party to judge and recommend an appropriate solution

130
Q

Organisational structure

A

the internal, formal framework of a business that shows the way in which management is organised and linked together and how authority is passed through the organisation

131
Q

Matrix structure

A

an organisational structure that creates project teams that cut across traditional functional departments

132
Q

Level of hierarchy

A

a stage of the organisation structure at which the personnel on it have equal status and authority

133
Q

Chain of command

A

this is the route through which authority is passed down an organisation

134
Q

Span of control

A

the number of subordinates reporting directly to a manager

135
Q

Delegation

A

passing authority down the organisational hierarchy

136
Q

Centralisation

A

keeping all of the important decision-making powers within head office or the centre of organisation

137
Q

Decentralisation:

A

decision-making powers are passed down the organisation to empower subordinates and regional/product managers

138
Q

Delayering

A

removal of one or more of the levels of hierarchy from an organisational structure

139
Q

Line managers

A

managers who have direct authority over people, decisions and resources within the hierarchy of an organisation

140
Q

Staff managers

A

managers who, as specialists, provide support, information and assistance to line managers

141
Q

Informal organisation

A

too many messages and too much information received that the most important ones can’t be identified and acted on

142
Q

Effective communication

A

the exchange of information between people or groups with feedback

143
Q

Information overload

A

: too many messages and too much information received that the most important ones can’t be identified and acted on

144
Q

Communication barriers

A

reasons why communication fails

145
Q

Formal communication networks

A

the official channels and routes used within an organisation

146
Q

Informal communication

A

unofficial channels of communication that exists between informal groups within an organisation

147
Q

Marketing

A

the management task that links the business to the customer by identifying and meeting the needs of customers profitably

148
Q

Consumer markets

A

markets for goods and services bought by the final user of them

149
Q

Industrial market

A

markets for goods and services bought by businesses to be used in the production process of other products

150
Q

Marketing objectives

A

the goals set for the marketing department to help the business achieve its overall objectives

151
Q

Marketing strategy

A

long-term plan established for achieving marketing objectives

152
Q

Market orientation

A

an outward-looking approach basing product decisions on customer demand, as established by market research

153
Q

Product orientated

A

an inward-looking approach that focuses on making products that can be made and then trying to sell them

154
Q

Asset-led marketing

A

an approach to marketing that bases strategy on the firms existing strengths and assets instead of purely what the customers want

155
Q

Societal marketing

A

this approach considers not only the demands of customers but also the effects on all members of the public involved in some way when firms meet these demands

156
Q

Demand:

A

the quantity of a product that consumers are willing and able to buy at a given price in a time period

157
Q

Supply

A

the quantity of a product that firms are willing and able to supply at a given price in a time period

158
Q

Equilibrium price

A

the market price that equates supply and demand of a product

159
Q

Market size

A

the total level of sales of all producers within a market

160
Q

Market growth

A

the percentage change in the total size of a market (volume or value) over a period of time

161
Q

Market share

A

: the percentage of sales in the total market sold by one business

162
Q

Product differentiation

A

making a product distinctive so that it stands out from competitors’’ products in consumers’ perception

163
Q

Unique selling point (USP

A

the special feature of a product that differentiates it from competitors’ products

164
Q

Niche marketing

A

identifying and exploiting a small segment of a large market by developing products that suit it

165
Q

Mass marketing

A

: selling the same products to the whole market with no attempt to target groups within it

166
Q

Market segmentation

A

: a sub-group of a whole market in which consumers have similar characteristics

167
Q

Market segmentation

A

identifying different segments within a market and targeting different products or services to them

168
Q

Consumer profile

A

a qualified picture of consumers of a firms products, showing proportions of age groups, income levels, location, gender and social class

169
Q

Market research

A

this is the process of collecting, recording and analysing data about the customers, competitors and the market

170
Q

Primary research

A

the collection of first hand data that is directly related to a firms needs

171
Q

Secondary research:

A

collection of data from second hand sources

172
Q

Qualitative research

A

research into the in-depth motivations behind consumers buying behaviour or opinions

173
Q

Focus groups

A

a group of people who are asked about their attitude towards a product, service, advertisement or new style of packaging

174
Q

Quantitative research

A

: research that leads to numerical results that can be statistically analysed

175
Q

Sample:

A

the group of people taking part in a market research survey selected to be representative of the overall target market

176
Q

Random sampling

A

every member of the target population has an equal chance of being selected

177
Q

Systematic sampling

A

every nth item in the target population is selected

178
Q

Stratified sampling

A

this draws a specified sub-group or segment of the population and uses random sampling to select an appropriate number from each stratum

179
Q

Quota sampling

A

when the population has been stratified and the interviewer selects an appropriate number of respondents from each stratum

180
Q

Cluster sampling

A

using one or a number of specific groups to draw samples from and not selecting from the whole population

181
Q

Arithmetic Mean

A

calculating by totalling all the results and dividing by the number of results

182
Q

Mode

A

the value that occurs most frequently in a set of data

183
Q

Median

A

the value of the middle when data have been ordered or ranked

184
Q

Range

A

the difference between the highest and lowest value

185
Q

Inter-quartile range

A

the range of the middle 50% of the data

186
Q

Marketing mix:

A

the four key decisions that must be taken in the effective marketing of a product

187
Q

Customer relationship marketing (CRM)

A

using marketing activities to establish successful customer relationships so that existing customer loyalty can be maintained

188
Q

Product:

A

the end result of the production process sold on the market to satisfy a customer’s needs

189
Q

Consumer durable

A

: manufactured product that can be reused and is expected to have a reasonably long life

190
Q

Brand

A

: an identifying symbol, name, image or trademark that distinguishes a product from its competitors

191
Q

Product positioning

A

the consumer perception of a product or service as compared to its competitors

192
Q

Product life cycle

A

the pattern of sales recorded by a product from launch to withdrawal from the market

193
Q

Extension strategies

A

these are marketing plans to extend the maturity stage of the product before a new one is needed

194
Q

Price elasticity of demand

A

measures the responsiveness of demand following a change in price

195
Q

Mark up pricing

A

adding a fixed mark up for profit to unit price of a product

196
Q

Target pricing

A

setting a price that will give a required rate of return at a certain level of output/sales

197
Q

Full-cost pricing

A

setting a price by calculating a unit cost for the product and then adding a fixed profit margin

198
Q

Contribution cost pricing

A

setting prices based on the variable costs of making a product in order to make a contribution towards fixed costs and profit

199
Q

Competition-based pricing

A

a firm will base its price upon the price set by its competitors

200
Q

Penetration pricing

A

setting a relatively low price often supported by strong promotion in order to achieve a high volume of sales

201
Q

Market skimming

A

setting a high price for a new product when a firm has a unique or highly differentiated product with low price elasticity of demand

202
Q

Promotion

A

the use of advertising, sales promotion, personal selling, direct mailing, trade fairs, sponsorship and public relations to inform consumers and persuade them to buy

203
Q

Promotion mix

A

the combination of promotional techniques that a firm uses to sell a product

204
Q

Advertising

A

paid-for communication with consumers to inform and the combination of promotional techniques that a firm uses to sell a product persuade

205
Q

Above the line promotion

A

a form of promotion that is undertaken by a business by paying for communication with consumers

206
Q

Sales promotion

A

: incentives such as special offers or deals directed at consumers or retailers to achieve short-term sale increases and repeated purchases by consumers

207
Q

Below the line promotion

A

promotion that is not a directly paid for means of communication but based on short term incentives to purchase

208
Q

Personal selling

A

a member of staff communicates with one customer with the aim of selling the product and establishing a long term relationship between the company and consumer

209
Q

Sponsorship

A

payment by a company to the organisers of an event so that the company name becomes associated with the event

210
Q

Public relations

A

the deliberate use of free publicity provided by newspapers, TV, and other media to communicate with and achieve understanding by the public

211
Q

Marketing or promotion budgeting

A

the financial amount made available by a business for spending on marketing/promotion during a certain time period

212
Q

Channel of distribution

A

this refers to the chain of intermediaries a product passes through from producer to final consumer

213
Q

Internet marketing

A

the marketing of products over the internet

214
Q

Viral marketing:

A

the use of social networking sites or text messages to increase brand awareness or sell products

215
Q

Integrated marketing mix:

A

the key marketing decisions complement each other and work together to give customers a consistent message about the product

216
Q

Marketing plan

A

: it is a detailed, fully researched written, report on marketing objectives and the marketing strategy to be used to achieve them

217
Q

Promotional elasticity of demand

A

this measures the responsiveness of demand for a product following a change in the amount spent on promoting it

218
Q

Cross elasticity of demand

A

this measures the responsiveness of demand for a product following a change in the price of another product

219
Q

AIDA

A

: this is a model that explains the successive stages a customer passes through in buying a product: Attention Interest Desire Action

220
Q

DAGMAR

A

a process of establishing goals for a promotion campaign so that it is possible to determine whether it has been successful or not: Defining Advertising Goals for Measured Advertising Results

221
Q

New product development (NPD):

A

the design, creation and market of new goods and services

222
Q

Test marketing

A

the launch of the product on a small scale market to test consumers’ reactions to it

223
Q

Research and Development

A

the scientific research and technical development of new products and processes

224
Q

Sales forecasting

A

predicting future sales levels and sales trends

225
Q

Sales-force composite

A

a method of sales forecasting that adds together all of the individual predictions of future sales of all of the sales representatives working for a business

226
Q

Delphi method

A

a long-range qualitative forecasting technique that obtains forecasts from a panel of experts

227
Q

Jury of experts

A

the jury of experts uses the specialists within a business to make forecasts for the future

228
Q

The trend

A

: this is the underlying movement in a time series

229
Q

Seasonal fluctuations

A

: these are the regular and repeated variations that occur in sales data within a period of 12 months

230
Q

Cyclical fluctuations

A

: these variations in sales occur over periods of time of much more than a year and are due to the business cycle

231
Q

Random fluctuations

A

these can occur at any time and will cause unusual and unpredictable sales figures

232
Q

Globalisation

A

the growing trend towards worldwide markets in products, capital and labour, unrestricted by barriers

233
Q

International marketing

A

selling products in markets other than the original domestic market

234
Q

Pan global marketing

A

adopting a standardised product across the globe as if the entire world were a single market

235
Q

Global localisation

A

adapting the marketing mix, including differentiated products, to meet national and regional tastes and cultures

Business studies (A levels) (40 decks)

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