Larry Jarrell busn 110, 9-13 Flashcards
(170 cards)
1
Q
Financial capital–
A
Funds that a firm uses to acquire assets and finance its operations
2
Q
Finance–
A
functional area of business that is concerned with finding the best sources
3
Q
Risk–
A
degree of uncertainty regarding the outcome of a decision
4
Q
Risk-return tradeoff–
A
observation that financial opportunities that offer high rates of return are riskier than those offering lower rates of return
5
Q
Financial ratio analysis–
A
computing ratios that compare values of key accounts listed on financial statements
6
Q
Liquidity ratios–
A
measure the ability of a firm to obtain the cash it needs to pay its short-term debt as they come due
7
Q
Liquid asset–
A
can quickly be converted into cash with little risk of loss
8
Q
Asset management ratios–
A
measure how effectively a firm uses its assets to generate revenue
9
Q
Leverage ratio–
A
measure the extent to which a firm relies on debt financing in its capital structure
10
Q
Profitability ratios–
A
measure the rate of return a firm earns on various measures of investment
11
Q
Budgeted income statements–
A
shows how a firm’s budgeted sales and costs will affect expected net income
12
Q
Budgeted balance sheet–
A
forecasts the types and amounts of assets a firm will need to implement its future plans and how the firm will finance the assets
13
Q
Cash budget–
A
detailed forecast of future cash flows; helps financial managers identify when their firm is likely to experience temporary shortages or surpluses of cash
14
Q
Trade credit–
A
granted by sellers when they deliver goods and services to customers without requiring immediate payment, and it is a form of spontaneous financing
15
Q
Factor–
A
company that provides short-term financing to firms by purchasing their accounts receivables at a discount
16
Q
Line of credit–
A
arrangement between a firm and a bank
17
Q
Revolving credit agreement–
A
bank makes a binding commitment to provide funds up to a specified credit limit at any time during the term of the agreement; guaranteed line of credit
18
Q
Commercial paper–
A
short-term promissory notes issued by large corporations
19
Q
Retained earnings–
A
part of a firm’s net income that is reinvested
20
Q
Equity financing–
A
funds provided by the owners of a company
21
Q
Debt financing–
A
funds provided by lenders (creditors)
22
Q
Capital structure–
A
mix of equity and debt financing that a firm uses to meet its permanent financing needs
23
Q
Dodd-Frank act–
A
law enacted in the aftermath of the financial crisis of 2008-2009 that strengthened government oversight of financial markets
24
Q
Cash equivalents–
A
safe and highly liquid assets that many firms list with their cash holdings
25
U.S. treasury bills (T-bills)--
short-term marketable IOUs issued by the U.S. federal government
26
Money market mutual funds--
pool funds from many investors and use these funds to purchase very safe, highly liquid securities
27
Capital budgeting--
procedure a firm uses to evaluate long-term investment proposals
28
Time value of money--
principle that a dollar received in the future
29
Present value--
amount of money that, if invested today at a given rate of interest, would grow to become some future amount in a specified number of periods
30
Net present value (NPV)--
sum of the present values of expected future cash flows from an investment minus the cost of that investment
31
Financial markets--
transfer funds from savers to borrowers
32
Depository institution--
get funds by accepting checking and savings deposits and lending funds to borrowers
33
Credit union--
cooperatives that are owned by its depositors
34
Savings and loan association--
accept savings and checking account deposits to make mortgage loans
35
Securities broker--
act as agents for investors who want to buy and sell financial securities
36
Securities dealer--
participate directly in securities markets, and buy and sell stocks for their own accounts
37
Investment bank--
specialize in helping firms raise financial capital by issuing securities in primary markets
38
Federal Reserve Act of 1913--
established the federal reserve system (the Fed) as the central bank of the united states
39
Banking Act of 1933--
established federal deposit insurance corporation to insure bank deposits; prohibited commercial banks from selling insurance or performing the functions of investment banks
40
Securities Act of 1933--
required firms issuing new stocks in a public offering to file a registration statement with the Securities Exchange Commission (SEC)
41
Securities and Exchange Act of 1934--
established the Securities and Exchange Commission to regulate and oversee the securities industry
42
Financial Services Modernization Act of 1999--
overturned the section of the Banking Act of 1933 that prohibited commercial banks from selling insurance or performing the functions of investment banks
43
Common stock--
basic form of ownership in a corporation
44
Capital gain--
return on investment received if the price of the stock rises above the amount paid for it
45
Preferred stock--
gives its holder preference over common stockholders in terms of dividends and claims on assets
46
Bond--
formal debt instrument issued by a corporation or government entity
47
Maturity date--
date when a bond will come due
48
Par value (of a bond)--
value of a bond that the issuer promises to pay the bondholder when the bond matures
49
Coupon rate--
interest paid on a bond
50
Current yield--
amount of interest earned is expressed as a percentage of the bond’s current market price
51
Exchange traded fund (ETF)--
shares traded on securities markets that represent the legal right of ownership over part of a basket of individual stock certificates or securities
52
Primary securities market--
market in which newly issued securities are traded
53
Secondary securities market--
trades previously issued securities
54
Public offering--
new securities are offered to any investors who are willing and able to purchase them
55
Private placement--
negotiated between the issuing corporation and a small group of accredited investors
56
Convertible security--
bonds or shares of preferred stock that investors can exchange for a stated number of shares of common stock
57
Mutual fund--
institutional investor that raises funds by selling shares to investors and uses the accumulated funds to buy a portfolio of many different securities
58
Stock (or securities) exchange--
organized venue for trading stocks and securities that meet listing requirements
59
Over-the-counter (OTC) market--
securities that are not listed on exchanges are traded
60
Electronic communications network (ECN)--
automated, computerized securities trading system that automatically matches buyers and sellers
61
Market order--
tell brokers to buy or sell a specific security at the best currently available price
62
Limit order--
tell brokers to buy a specific stock only if its price is below a certain level, or to sell a specific stock only if its price is above a certain level
63
Stock index--
tracks how the prices of specific sets of stocks have changes
64
Dow Jones Industrial Average (DJIA)--
tracks stock prices of 30 large, well-known U.S. corporations
65
Standard & Poor’s 500--
based on prices of 500 major U.S. corporations in a variety of industries and market sectors
66
Marketing--
organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways the benefit the organization and its stakeholders
67
Utility--
ability of goods and services to satisfy wants
68
Customer relationship management (CRM)--
ongoing process of acquiring, maintaining, and growing profitable customer relationships by delivering unmatched value
69
Customer satisfaction--
customers’ perception that a good or service delivers value above and beyond their expectations
70
Customer loyalty--
customers repeatedly buy certain products
71
Marketing plan--
formal document that defines marketing objectives and the specific strategies for achieving those objectives
72
Market segmentation--
dividing potential customers into groups of similar people, or segments
73
Target market--
group of people who are most likely to buy a particular product
74
Consumer marketers (business-to-consumer or B2C)--
direct their efforts toward people who are buying products for personal consumption
75
Business marketers (business-to-business or B2B)--
direct their efforts toward people who are buying products to use either directly or indirectly to produce other products
76
Demographic segmentation--
dividing the market based on characteristics about people such as age, income, ethnicity, and gender
77
Geographic segmentation--
dividing the market based on where consumers live
78
Psychographic segmentation--
dividing the market based on consumer attitudes, interests, values, and lifestyles
79
Behavioral segmentation--
dividing the market based on how people behave towards various products
80
Marketing mix--
blend of marketing strategies for products, prices, distribution, and promotion
81
Consumer behavior--
people’s actions when they are buying, using, and discarding goods and services for their personal consumption
82
Cognitive dissonance--
consumer discomfort with a purchase decision typically for a higher-priced item
83
Business buyer behavior--
describes people’s behavior when they are buying products to use directly or indirectly to produce other products
84
Marketing research--
process of gathering, interpreting, and applying information to uncover opportunities and challenges, and to make better decisions
85
Secondary data--
existing data that marketers gather or purchase for a research project
86
Primary data--
new data that marketers compile for a specific research project
87
Observation research--
does not require the researcher to interact with the research subject
88
Survey research--
requires that the researcher interact with the research subject
89
Product--
anything that an organization offers to satisfy consumer needs and wants
90
Consumer products--
purchased for personal use or consumption
91
Business products--
purchased to use either directly or indirectly in the production of other products
92
Product differentiation--
attributes that make a good or service different from other products that compete to meet the same or similar customer needs
93
Quality level--
measure of how well a product performs its core functions
94
Product consistency--
measure of how reliable a product is in delivering its promised level of quality
95
Product features--
specific characteristics of a product
96
Customer benefit--
advantages that a customer gains from a specific product feature
97
Product line--
groups of products that are closely related to each other
98
Product mix--
total number of product lines and individual items sold by a single firm
99
Cannibalization--
when a firm’s new product takes sales away from its existing products
100
Brand--
a product’s identity that sets it apart from other players in the same category
101
Brand equity--
overall value of a brand to an organization
102
Line extensions--
similar products offered under the same brand name
103
Brand extension--
new product, in a new category, introduced under an existing brand name
104
Licensing--
purchasing the right to use another company’s brand name or symbol
105
Co Branding--
established brands from different companies joining forces to market the same product
106
National brands--
brands that the producer owns and markets
107
Store brands--
brands that the retailer both produces and distributes
108
Promotion--
influences consumer purchase decisions through information, persuasion, and reminders
109
Integrated marketing communication--
coordination of marketing messages through every promotional vehicle
110
Positioning statement--
articulates how the marketer would like the target market to envision a product relative to competition
111
Promotional channels--
specific marketing communication vehicles
112
Advertising--
designed to influence a target audience with regard to a product, service, organization, or idea
113
Sales promotion--
designed to stimulate sales activity through specific short-term programs
114
Consumer promotion--
generates immediate consumer sales
115
Trade promotion--
stimulates wholesalers and retailers to push specific products aggressively
116
Public relations (PR)--
ongoing effort to create positive relationships with all of a firm’s different publics
117
Publicity--
unpaid stories in the media that influence perceptions about a company or its product
118
Personal selling--
person-to-person presentation of products to potential buyers
119
Distribution strategy--
plan for delivering the right product to the right person at the right place at the right time
120
Channel of distribution--
network of organizations and processes that links producers to consumers
121
Physical distribution--
actual, physical, movement of products along the distribution pathways
122
Direct channel--
distribution process that links a producer and a customer with no intermediaries
123
Channel intermediaries--
distribution organizations that facilitate the movement of products from a producer to a consumer
124
Retailers--
distributors who sell products directly to users in small quantities
125
Wholesalers--
distributors that buy products from producers and sell them to other businesses
126
Merchant wholesalers--
take legal possession of the goods they distribute
127
Agents/brokers--
do not take title of the goods they distribute
128
Multichannel retailing--
provides multiple distribution channels for consumers to buy a product
129
Multi Level marketing (MLM)--
involves hiring independent contractors to sell products to their personal network
130
Supply chain--
all organizations, processes, and activities involved in the flow of goods from raw materials to the final consumer
131
Supply chain management (SCM)--
planning and coordinating the movement of products along the supply chain
132
Logistics--
subset of SCM that focuses on the tactics involved in moving products along the supply chain
133
Penetration pricing--
aims to capture the market through rock-bottom prices
134
Everyday-low pricing (EDLP)--
designed to achieve profitability through high sales volume; long-term discount pricing
135
High/low pricing--
designed to drive traffic to retail stores by special sales on a limited number of products, and higher everyday prices on others
136
Loss-leader pricing--
pricing a handful of items temporarily below cost to drive traffic
137
Skimming pricing--
aims to maximize profitability by offering new products at a premium price
138
Break even analysis--
process of determining the number of units a firm must sell to cover all costs
139
Profit margin--
gap between the cost and the price of an item on a per-product basis
140
Odd pricing--
practice of ending prices in numbers below even dollars and cents in order to create a perception of greater value
141
Financial leverage--
the use of debt in a firm’s capital structure
142
Spontaneous financing--
financing that arises during the natural course of business without the need for special arrangements
143
Covenant--
a restriction lenders impose on borrowers as a condition of providing long-term debt financing
144
Certificate of deposit (CD)--
an interest-earning deposit that requires the funds to remain deposited for a fixed term. Withdrawal of the funds before the term expires results in a financial penalty
145
Securities and Exchange Commission--
the federal agency with primary responsibility for regulating the securities industry
146
Net asset value per share--
the value of a mutual fund’s securities and cash holdings minus any liabilities, divided by the number of shares of the fund outstanding
147
Financial diversification--
a strategy of investing in a wide variety of securities in order to reduce risk
148
Initial public offering (IPO)--
the first time a company issues stock that may be bought by the general public
149
Underwriting--
an arrangement under which an investment banker agrees to purchase all shares of a public offering at an agreed-upon price
150
Registration statement--
a long, complex document that firms must fi;e with the SEC when they sell securities through a public offering
151
Accredited investor--
an organization or individual investor who meets certain criteria established by the SEC and so qualifies to invest in unregistered securities
152
Market makers--
securities dealers that make a commitment to continuously offer to buy and sell the stock of a specific corporation listed on the NASDAQ exchange or traded in the OTC market
153
Marketing concept--
a business philosophy that makes customer satisfaction - now and in the future - the central focus of the entire organization
154
Value--
a customer perception that a product has a better relationship than its competitors between the cost and the benefits
155
Environmental scanning--
the process of continually collecting information from the external marketing environment
156
Market share--
the percentage of a market controlled by a given marketer
157
Green marketing--
developing and promoting environmentally sound products and practices to gain a competitive edge
158
Mass customization--
the creation of products tailored for individual consumers on a mass basis
159
Pure goods--
products that do not include any services
160
Pure services--
products that do not include any goods
161
Product life cycle--
a pattern of sales and profits that typically changes over time
162
Product placement--
the paid integration of branded products into movies, television, and other media
163
Advergaming--
video games created as a marketing tool, usually with brand awareness as the core goal
164
Buzz marketing--
the active stimulation of word of mouth via unconventional, and often relatively low-cost, tactics. Also known as guerrilla marketing and viral marketing
165
Sponsorship--
a deep association between a marketer and a partner which involves promotion of the sponsor in exchange for either payment or the provision of goods
166
Push strategy--
a marketing approach that involves motivating distributors to heavily promote a product to the final customers, usually through heavy trade promotion and personal selling
167
Pull strategy--
a marketing approach that involves creating demand from the ultimate consumers so that they “pull” your products through the distribution channels by actively seeking them
168
Independent wholesaling businesses--
independent distributors that buy products from a range of different businesses and sell those products to a range of different customers
169
Wheel of retailing--
a classic distribution theory that suggests that retail firms and retail categories become more upscale as they go through their life cycles
170
Modes of transportation--
the various transportation options (planes, trains, and railroads) move products through the supply chain
