front 1 Business | back 1 An organisation that organises and combines resources to produce goods and services to satisfy the needs and wants of consumers while making a profit |
front 2 Production | back 2 Organising and combining resources to produce goods and services |
front 3 Scarcity OR Economic problem | back 3 Limited resources in relation to the unlimited wants. |
front 4 Needs | back 4 Basic necessities that are crucial for survival and day to day life such as food, clothing, and shelter. |
front 5 Wants | back 5 Desires of the consumers which are not basic necessities. Wants can be luxuries. |
front 6 Opportunity cost | back 6 Next best alternative forgone |
front 7 Resources / Factors of Production | back 7 Inputs used to make goods and services. For example, Capital, Enterprise, Land, & Labour. |
front 8 Capital / Capital Goods | back 8 Amount invested in human made resources such as Equipment, Buildings and Machinery etc. |
front 9 Enterprise | back 9 Risk Taking ability, or skills and knowledge. |
front 10 Entrepreneur | back 10 A person with risk taking ability. A person who is willing to take risk and take business decisions. |
front 11 Land | back 11 All natural resources such as Vegetables, Fruits, Cattle, Minerals etc. |
front 12 Labour | back 12 Human effort or human resources, such as workers. |
front 13 Added value | back 13 Difference between the selling price of a product and the cost of producing that product. |
front 14 Adding value | back 14 Process of increasing the difference between the selling price of a product and the cost of producing that product. Trying to increase the Added Value. |
front 15 Mark-Up | back 15 Extra amount added to the cost of the product in order to calculate the selling price. |
front 16 Specialisation | back 16 When people and businesses concentrate on what they are best at. |
front 17 Business specialisation | back 17 It is when a business focuses on producing a specific range of goods and services. |
front 18 Labour specialisation OR Division of labour | back 18 The way in which work is divided so each worker concentrates on a specific task to become expert at it. |
front 19 Revenue OR Sales Revenue | back 19 Amounts earned by selling goods and services. = Selling Price per unit x Quantity Sold |
front 20 Expenses OR Costs | back 20 Amounts spent to run day to day operations of the business, and amount spent to produce goods and services. |
front 21 Profit | back 21 It is when revenues exceed the costs |
front 22 Loss | back 22 It is when costs exceed the revenues |
front 23 Primary sector | back 23 Firms whose business activity involves the extraction of raw materials |
front 24 Secondary sector | back 24 Firms that process and manufacture goods from natural resources |
front 25 Tertiary sector | back 25 Businesses which provide services to consumers and other businesses. |
front 26 Private sector | back 26 A business that is owned and controlled by normal individuals and not by the government. |
front 27 Public sector OR Public corporation | back 27 A business that is owned and controlled by the government. |
front 28 Industrialisation | back 28 It is when more factories are opened in the country. Increase in the secondary sector in an economy. |
front 29 De-industrialisation | back 29 It is when factories are closed down in a country. Decrease in the secondary sector in an economy. |
front 30 Less-Developed Economy OR Less Economically Developed Country (LEDC) | back 30 It is when a country is highly dependent on its primary sector firms, and its most GDP comes from the primary sector. It has low income and lower living standards. |
front 31 Developing Country OR Developing Economy | back 31 It is when a country is highly dependent on its secondary sector firms, and its most GDP comes from the secondary sector. It has a middle income and moderate living standards. |
front 32 Developed Economy OR More Economically Developed Country (MEDC) | back 32 It is when a country is highly dependent on its tertiary sector firms, and its most GDP comes from the tertiary sector. It has high income and high living standards. |
front 33 Command economy OR Planned economy | back 33 An economy in which the Government has full control over the factors of production. |
front 34 Market economy OR Free Market Economy | back 34 An economy in which the Government has no control over the factors of production. |
front 35 Mixed economy | back 35 An economy that has both a private and public sector. |
front 36 Business objective | back 36 A statement of a specific target that a business works towards |
front 37 Business plan | back 37 A document that states aims and objectives and shows how business plans to achieve them. |
front 38 Financial benefit OR Profit | back 38 It refers to a benefit that a business gets financially, in a period. |
front 39 Growth (Business Growth) | back 39 It is when a business increases in size. It can be through more output, employees, capital or market share. |
front 40 Market share | back 40 Percentage of the total market sales held by one brand or business. = Business sales / Total market sales × 100 |
front 41 Market leader | back 41 A Business with the largest market share for a product in a market. |
front 42 Survival | back 42 It is when a business tries to make enough sales in order to survive in the market and to cover their expenses. e.g. Reaching the breakeven point of sales |
front 43 Social enterprise | back 43 Business with both social objectives and environmental objectives along with aiming to make a profit. |
front 44 Profit Satisficing | back 44 Satisfying the shareholders with enough profit, and then focusing on other objectives such as environmental, and social objectives. |
front 45 Corporate Social Responsibility (CSR) OR Social Objectives | back 45 It is when a profitable business contributes to the society by helping the people and environment. Giving back to society. |
front 46 Environmental Objectives | back 46 It is when a profitable business uses renewable resources to protect the environment and reduces the carbon dioxide emissions and other wastes. |
front 47 Merger | back 47 It is when two or more businesses combine their resources to become one larger business. |
front 48 Takeover OR Acquisition | back 48 It is when one business takes over another business. This is done by buying the ownership of another business. |
front 49 Internal Growth | back 49 It is when a business grows by reinvesting its profits. It is also known as organic growth. |
front 50 External Growth | back 50 It is when a business grows by merger with another business or takeover of another business. |
front 51 Horizontal Integration | back 51 It is when a business merges or takes over another business within a similar industry and same stage of production. |
front 52 Vertical Integration | back 52 It is when a business merges or takes over another business within a similar industry but a different stage of production. |
front 53 Forward-Vertical Integration | back 53 It is when a business merges or takes over another business within a similar industry but a stage of production that is ahead of its current stage. e.g. A cocoa farm buys a chocolate factory. |
front 54 Backward-Vertical Integration | back 54 It is when a business merges or takes over another business within a similar industry but a stage of production that is before its current stage. e.g. A chocolate shop buys a chocolate factory. |
front 55 Conglomerate Integration OR Lateral Integration | back 55 It is when a business merges or takes over another business of a different industry. |
front 56 Limited liability | back 56 Liability of shareholders in a company is only limited to the amount they invested. Owners are not personally liable for the company's loans. |
front 57 Unlimited liability | back 57 Owners of the business are personally liable to pay the company's debts if the company fails. Owners personal belongings are taken away to settle the business' debts. |
front 58 Unincorporated Business | back 58 A business that doesn't have a separate legal entity, and has an unlimited liability for its owners. |
front 59 Incorporated Business | back 59 A business that has a separate legal entity, and has a limited liability for its owners. |
front 60 Sole trader | back 60 An unincorporated business owned and controlled by one person |
front 61 Partnership | back 61 An unincorporated business that has more than one owner. More than one person join together to start and run the business. |
front 62 Limited company | back 62 A business which has a limited liability and a separate legal identity from its owners. |
front 63 Private limited company | back 63 A type of limited company owned by shareholders, but it can only sell shares to friends or family. |
front 64 Public limited company | back 64 A type of limited company that sells its shares to the general public through a stock exchange. |
front 65 Dividends | back 65 Portion of profit for the year paid to the shareholders as a reward for their investment in the company |
front 66 Retained Profits OR Retained Earnings | back 66 Portion of profit kept in the business for future reinvestment. It is an internal source of finance. |
front 67 Franchise OR Franchise Agreement | back 67 A business agreement and system where entrepreneurs buy the right to use the name, logo and product of an existing business. |
front 68 Franchisor | back 68 Owner of a brand that is used in a franchise agreement. Franchisor gives the right to use the brand name to the franchisee. |
front 69 Franchisee | back 69 The business that is taking the rights to use a brand in a franchise agreement. Franchisees buy the right to use the brand name from the franchisor. |
front 70 Royalty (Royalty payment) | back 70 Portion of sales or profit paid to the franchisor by the franchisee on a regular basis in return of using the brand name. |
front 71 Licensing | back 71 Allowing other businesses usually in other countries to produce the goods and services under a brand name in exchange of license fees. |
front 72 Shareholders | back 72 Shareholders are the owners of a limited company. |
front 73 Stock exchange OR Stock Market | back 73 An organisation where new and existing shares of public limited companies are bought and sold. |
front 74 Annual General Meeting | back 74 It is a compulsory annual meeting held by a limited company where shareholders decide and vote for major decisions of the business |
front 75 Flotation OR Initial Public Offering (IPO) | back 75 It is when a private limited company start selling its shares to the public for the first time to become a public limited company |
front 76 Partners | back 76 Owners of a partnership business. Each partner has a role in the partnership and may share profit or loss in the business. |
front 77 Partnership agreement | back 77 An agreement between partners in a partnership that show the terms of the partnership such as profit sharing ratio, and responsibilities of the partners. |
front 78 E-commerce | back 78 Process of buying and selling goods and services over the Internet. |
front 79 Joint venture | back 79 When two or more businesses agree to start a (new) project together, hence sharing risks, capital, profits or resources. |
front 80 Ethical business | back 80 An organisation that takes decisions by doing the right thing which is beneficial for the overall society. |
front 81 Unethical business | back 81 An organisation that doesn't take decisions based on a moral code and doesn't care about the environmental and societal consequences of their business activity. |
front 82 Stakeholder group OR Stakeholders | back 82 Any individual or group which has an interest in a business because they are affected by its activities. |
front 83 Internal stakeholders | back 83 Stakeholders that either own the business or work for the business. E.g. Owners, Managers, and employees. |
front 84 External stakeholders | back 84 Stakeholders that do not own the business or work for the business but have an interest in the business. e.g. Banks, Suppliers, Government, General Public and society. |