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A1 Eco - MACRO > Definitions > Flashcards

Flashcards in Definitions Deck (13)
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1
Q

what is merging?

A

when two or more firms become one.

2
Q

what is integration?

A

when a firm grows either organically or inorganically.

3
Q

what is inorganic growth/ a take over?

A

when a firm pays to take over another.

4
Q

what is organic growth/ international expansion?

A

increasing production inside businesses.

5
Q

what is horizontal integration?

A

same point of production. E.g. walkers buys tyrells

6
Q

what is vertical integration

A

diff point of production. E.g. walkers buys a potato farm.

7
Q

what is a variable cost?

A

a cost that changes with output

8
Q

what is a fixed cost?

A

a cost that does not change.

9
Q

what is a direct cost?

A

a cost that is used in the production of a product. E.g. raw materials, salaries etc. This could be variable or the same.

10
Q

what is an indirect cost?

A

something that is not directly attributable to a business. E.g. a coffee machine in a business.

11
Q

what is a single market?

A

where members are allowed free trade within other members. also have to trade with non members collectively.

12
Q

what is protectionism?

A

an economy protects itself from companies in other countries who are better or cheaper.

13
Q

how does a strong pound effect X and M?

A

strong pound = imports cheaper, exports dearer.