AQA AS Key Term Glossary

Question 1

Autocratic

Answer 1

Management / leadership style whereby the manager makes all the decisions

Question 2

Blake Mouton Grid

Answer 2

A model which examines a managers behaviour based on their concern for people and concern for production

Question 3

Buffer Inventory

Answer 3

Minimum level of inventory required by a business

Question 4

Capacity utilisation

Answer 4

The proportion of total capacity that is used (expressed as a %)

Question 5

Competition

Answer 5

The businesses that compete for a share of a market

Question 6

Competitiveness

Answer 6

The ability of a business to offer a better product than competitors (as measured by customers)

Question 7

Delegation

Answer 7

Where responsibility for carrying out a task or role is passed onto someone else in the business

Question 8

Demand

Answer 8

The amount of a product or service that customers are willing and able to pay for at a given time

Question 9

Democratic

Answer 9

Management leadership style whereby the manager involves employees in the decision making process

Question 10

Distribution channel

Answer 10

How a business gets its products to the end of the consumer (with or without the use of intermediaries)

Question 11

Dividend

Answer 11

A payment that is made by a company to its shareholders from profit earned

Question 12

Fixed costs

Answer 12

Costs that do not vary with the level of output

Question 13

Hierarchy

Answer 13

The structure and number of layers of management and supervision in an organisation

Question 14

Inventory control

Answer 14

The processes and controls used by a business to ensure that it has sufficient (but not too much) inventory for its purposes

Question 15

Job design

Answer 15

The way in which tasks are combined to form a job

Question 16

Just-in-time (JIT) production

Answer 16

A method of inventory control whereby inventory arrives just at the time that it is needed

Question 17

Labour productivity

Answer 17

The output produced per employee over a given time period

Question 18

Lean production

Answer 18

A method of production that aims to reduce waste

Question 19

Limited liability

Answer 19

Shareholders are only liable for the money they have invested - not for the overall debts and liabilities of their company

Question 20

Market capitalisation

Answer 20

Number of shares x the current share price of those shares on the stock market

Question 21

Market growth

Answer 21

The % growth in size of the market, measured over a specific period

Question 22

Market share

Answer 22

The share of the total market that is owned by a particular business, product or brand

Question 23

Mass customisation

Answer 23

The ability to offer products designed for the individual on a large scale`

Question 24

Opportunity cost

Answer 24

The cost of a decision as measured by the benefits foregone of the next best alternative

Question 25

Organisational structure

Answer 25

The way that the roles and responsibilities within an organisation are structured

Question 26

Private Limited Company (Ltd)

Answer 26

A business owned and controlled by shareholders whose shares cannot be publicly traded

Question 27

Profitability

Answer 27

The ability of a business to generate profits from its activities

Question 28

Public Limited Company (PLC)

Answer 28

A business whose shares can be traded and sold to the public

Question 29

Quality

Answer 29

Where a product meets a customer's requirements

Question 30

Quality assurance

Answer 30

Organising every process to get the product ' right first time ' and prevent mistakes ever happening

Question 31

Sole trader

Answer 31

A one-person business with unlimited liability for the debts of that business

Question 32

Span of control

Answer 32

The number of employees who are directly supervised by a manager

Question 33

Spare capacity

Answer 33

When a business is able to produce more with existing resources (also known as excess capacity)

Question 34

Stakeholder

Answer 34

A person or group with an interest in a business

Question 35

Tannenbaum & Schmidt Continuum

Answer 35

A model of leadership that examines the relationship between how much freedom a manager gives the workers and how much authority is retained

Question 36

Total costs

Answer 36

The total of variable and fixed costs ina business

Question 37

Unit costs

Answer 37

The average production cost per unit

Question 38

Unlimited liability

Answer 38

Unlimited liability describes the potential risk that sole traders face. They are liable for the debts of the business

Question 39

Variable costs

Answer 39

Costs that vary directly in proportion to output

Question 40

Waste

Answer 40

A cost of production. Sub-standard completed output or raw materials which are not retained in the production process