Key Words

Question 1

Aim and objectives

Answer 1

Statements of what the business is trying to achieve, such as grow larger and make a profit

Question 2

Example of aims

Answer 2

Survival, profit , growth, providing a service

Question 3

Business growth

Answer 3

A business grows when it sells more output over a period of time

Question 4

Organic growth

Answer 4

Concerned with the internal growth of a business for example by increasing its sales

Question 5

External growth

Answer 5

The growth of a business by takeover or merger

Question 6

Backwards vertical growth

Answer 6

When a business merges with or takes over a business that supplies it with good or services

Question 7

Forward vertical growth

Answer 7

When a business merges with or takes over a business that it supplies goods or services to

Question 8

Diversification

Answer 8

When a business merges with or takes over another business with which it has no connection

Question 9

Horizontal growth

Answer 9

A merger or takeover where the two businesses are involved in a similar operation

Question 10

Business plan

Answer 10

A simple plan which sets out details of the product or service being sold and how it will be financed, marketed and details of market research findings

Question 11

Capital

Answer 11

is the money invested in a company by the shareholders

Question 12

Dividend

Answer 12

A sum of money paid regularly by a company to its shareholders out of its profits

Question 13

Entrepreneur

Answer 13

A person who takes the risk of starting and running a business enterprise

Question 14

Characteristics of an entrepreneur

Answer 14

The features of an entrepreneur which include being determined, creative, confidence and having the ability to take risks

Question 15

Stakeholders

Answer 15

Groups or individuals who have an interest in a business

Question 16

Examples of internal stakeholders

Answer 16

Owners, employees

Question 17

Examples of external stakeholders

Answer 17

Customers , suppliers, government, local community

Question 18

What is unlimited liability

Answer 18

The owner of a business is responsible for repaying all the debts of a business so they may lose personal assets

Question 19

What is unlimited liability

Answer 19

The owners of a business can only lose the money they have invested in a business if it fails

Question 20

Definition of operate

Answer 20

Term used to explain how a business works

Question 21

Define market share

Answer 21

The percentage of total sales of a product that a business has made

Question 22

What is a limited liability partnership

Answer 22

where each partner has limited personal liability for the debts or claims of the partnership

Question 23

What is marketing

Answer 23

is about raising awareness that a business exists and continuing to keep customers up to date about events, offers, new services or updated menus

Question 24

What is a merger

Answer 24

Where two or more businesses agree to join to become one business

Question 25

What is a takeover

Answer 25

When a business takes a controlling interest in another business for example by buying more than 50% shares of it

Question 26

What is profit

Answer 26

the money that is left over once all of the expenses incurred in running the business have been paid

Question 27

What is providing service

Answer 27

accountants, dry cleaners, paid-parking providers, home maintenance firms and motor vehicle repairers

Question 28

Success

Answer 28

For a business, success may take many forms including making profit, surviving and providing a good service to customers

Question 29

Satisficing

Answer 29

looking to be just good enough to achieve their other objectives but no more than that

Question 30

Spotting an opportunity

Answer 30

situation where a person or organization identifies a need or demand in the market that can be met through the business expanding

Question 31

Shareholders

Answer 31

part owners of a private or public limited company

Question 32

Sleeping partner

Answer 32

A partner who invests but is not involved in the day-to-day running of a partnership

Question 33

Survival

Answer 33

keeping the business operating for a certain amount of time. Most businesses initially aim to survive their first year.

Question 34

Survival

Answer 34

keeping the business operating for a certain amount of time. Most businesses initially aim to survive their first year.

Question 35

What is a chain of command

Answer 35

the route by which instructions and communications flow from the top to the bottom of a business, explaining who is answerable to whom.

Question 36

What is a contract of employment

Answer 36

legal agreement between the employer and employee, which sets out the terms and conditions of employment, including: working hours. pay.

Question 37

What is delegation

Answer 37

a process where tasks are given to members of staff, who then give tasks to employees further down the chain of command.

Question 38

What is an employment agency

Answer 38

businesses that find suitable employees for job vacancies for other businesses

Question 39

What is the employment law

Answer 39

Laws protecting the rights of employees which must be obeyed by the employers

Question 40

What is Employment Tribunal

Answer 40

the judicial body with responsibility for workplace justice, being the main forum for deciding disputes between workers and employers

Question 41

What is aftersales service

Answer 41

providing support for customers who have bought a product or service from a business

Question 42

What is batch production

Answer 42

method whereby a group of identical products are produced simultaneously (rather than one at a time)

Question 43

What is flow production

Answer 43

continuously making identical products

Question 44

What is job production

Answer 44

when individual products are made one at a time to meet specific customer preferences

Question 45

What is automation

Answer 45

The use of machinery to replace human resources

Question 46

What is fit for purpose

Answer 46

goods must do what they are designed to do

Question 47

What is a multinational company

Answer 47

A business that operates in multiple countries

Question 48

What is a quota

Answer 48

Set amount of sales or other actions that you must meet in a certain period

Question 49

What is a recession

Answer 49

Period of significant decline in economic activity

Question 50

What is a tariffs

Answer 50

Taxes charged on goods imported from other countries

Question 51

What is gross domestic product

Answer 51

Measure of a country’s total economic output