ALL BUSINESS UNIT 2 VOCABULARY Flashcards
Barriers to entry
Factors which make it difficult or impossible for businesses to enter a market and compete with existing producers.
Cartel
A group of businesses which join together to agree on pricing and output in a market in an attempt to gain higher profits at the expense of customers.
Colluding
Where several businesses make agreements amongst themselves which benefit them at the expense of either rival businesses or customers.
Market Structures
The characteristics of a market, such as the size of the barriers to entry to the market, which determine the behaviour of businesses within the market.
Anti-competitive or restrictive practices
Attempts by firms to prevent or restrict competition.
Contract of Employment
A written agreement between an employer and employee, in which each has certain obligations.
Discrimination
Favouring one person over another usually on the basis of race, gender, age, etc.
Employment Tribunal
A court that deals with cases involving disputes between employers and employees.
National Minimum Wage
A wage rate set by the government below which it is illegal to pay people at work.
Unfair Dismissal
The illegal dismissal of a worker by the business.
Appreciation of a currency
A rise in the value of a currency.
Base Rate
The rate of interest around which a bank structures other interest rates.
Boom
The peak of the economic cycle where GDP is growing at its fastest.
Consumer Price Index (CPI)
A common measure of price changes used in the EU.
Deflation
A fall in general price levels.
Depreciation
A fall in the value of a currency.
Downturn
A period in the economic cycle, where GDP grows but more slowly.
Economic, trade and business cycle
Regular fluctuations in the level of output in the economy.
Exchange Rate
The value of one currency in terms of another.
Government Expenditure
The amount spent by the government on its provision of public services.
Fiscal Policy
Using changes in taxation and government expenditure to manage the economy.
Gross Domestic Product (GDP)
A common measure of national income, output or employment.
Index-linked
The linking of certain payments such as benefits, to the rate of inflation.
Inflation
A general rise in prices.
Monetary Policy
Using changes in the interest rate and money supply to manage the economy.
Recession
A less severe form of depression.
Recover or upswing
A period where economic growth begins to increase again after a recession.
Slump or depression
The bottom of the economic cycle where GDP starts to fall with significant increases in unemployment.
Taxation
The charges made by the government on the activities, earnings and incomes of businesses and individuals.
Quality
Features of a product that allow it to satisfy customers’ needs. It may refer to some standard of excellence.
Quality Assurance
A method of working for businesses that take into account customers’ wants when standardizing quality.
Quality Chains
When employees form a series links between suppliers and customers in a business, both internally and externally.
Statistical Process Control
The collection of data about the performance of a particular process in the business.
Total Quality Management (TQM)
A managerial approach that aims to improve the effectiveness, flexibility, and competitiveness of the business.
Buffer stocks
Stocks held as a precaution to cope with unforeseen demand.
Kanban
A card or an object that acts as a signal to move or provide resources in a factory.
Lead time
The time between placing the order and the delivery of goods.
Re-order level
The level of current stocks when new orders are placed.
Re-order quantity
The amount of stock ordered when an order is placed.
Stock Rotation
The flow of stock into and out of storage.
Work-in-progress
Party finished goods.
Capacity Utilisation
The use that a business makes of its resources.
Excess or surplus capacity
When a business has too many resources, such as labour and capital, to produce its desired level of output.
Full capacity
The point where a business cannot produce any more output.
Mothballing
Leaving machines, equipment or building spaces unused, but maintained, so that they can be brought back into the business if necessary.
Over-utilisation
The position where a business is running at fully capacity and ‘straining’ resources.
Rationalisation
Reducing the number of resources put into the production process, usually undertaken because a business has excess capacity.
Under-utilisation
The position where a business is producing at less than full capacity.
Batch production
A method that involves completing one operation at a time on all units before performing the next.
Capital Intensive
Production methods that make more use of machinery relative to labour.
Capital Productivity
The amount of output each unit of capital produces.
Cell Production
Involves producing a family of products in a small self-contained unit within a factory.
Cell production
Involves producing a family of products in a small self-contained unit within a factory.
Division of Labour
Specialisation in specific tasks or skills by an individual.
Downsizing
The process of reducing capacity usually by laying off staff.
Efficiency
Producing a level of output where average cost is minimised.
Flow Production
Large-scale production of a standard product
Job production
A method of production that involves employing all factors to complete one unit per output at a time.
Kaizen
A Japanese term that means ‘continuous improvement’.
Labour intensive
Production methods that make more use of labour relative to machinery.
Labour productivity
The amount of output each unit of labour produces.
Lean production
An approach to operations that focuses on the reduction of resource use.
Outsourcing
Giving work to sub-contractors to reduce costs.
Production
The transformation of resources into goods and services.
Productivity
The output per unit of input per time period.
Specialisation
The production of a limited range of goods.
Standardisation
Using uniform resources and activities to produce uniform products.
