Definitions Flashcards
what is merging?
when two or more firms become one.
what is integration?
when a firm grows either organically or inorganically.
what is inorganic growth/ a take over?
when a firm pays to take over another.
what is organic growth/ international expansion?
increasing production inside businesses.
what is horizontal integration?
same point of production. E.g. walkers buys tyrells
what is vertical integration
diff point of production. E.g. walkers buys a potato farm.
what is a variable cost?
a cost that changes with output
what is a fixed cost?
a cost that does not change.
what is a direct cost?
a cost that is used in the production of a product. E.g. raw materials, salaries etc. This could be variable or the same.
what is an indirect cost?
something that is not directly attributable to a business. E.g. a coffee machine in a business.
what is a single market?
where members are allowed free trade within other members. also have to trade with non members collectively.
what is protectionism?
an economy protects itself from companies in other countries who are better or cheaper.
how does a strong pound effect X and M?
strong pound = imports cheaper, exports dearer.
