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Description
Flashcards by Влад Ермаков, updated more than 1 year ago
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Created by Влад Ермаков
over 11 years ago
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| Question | Answer |
| Limited Liability | The only liability a shareholder has if the company fails is the amount invested in the company, not the wealth of him |
| Consumer goods | Physical goods sold to the public. |
| Consumer services | The products that don't not physically exist that are sold to the public (barber shop) |
| Capital goods | Goods used by a company to help it in production |
| 4 factors of production | Land Labour Capital Enterprise |
| Added value | Difference between cost of production and selling price |
| Entrepreneur | Someone who takes the financial risk of starting and managing a new business |
| Social enterprise | A business with many social objectives that reinvests most of its profit into society (not a charity) Has economic, social and environmental objectives |
| Opportunity cost | The benefit of the next most desired option which is not chosen |
| Primary sector business activity | Industry that extracts natural resources |
| Secondary sector business activity | Firms that manufactures and processes natural resources into finished goods |
| Tertiary sector | Firms that provide services to consumers and other businesses |
| Private sector | The business that is owned and controlled by individual or group of individuals |
| Public sector | A sector that is controlled by central or local government |
| Mixed economy | Economic resources are owned and controlled by both private and public sectors |
| Free-market economy | Economic resources owned largely by the private sector with little state intervention |
| Command economy | Economic resources owned, planned and controlled by the state |
| Sole trader | A business in which one person keeps the profit, has full control of the business and provides financing |
| Partnership | A business formed by two or more individuals to carry out business together, with shared responsibilities and capital invested |
| Share | A certificate confirming the part of ownership of a company and owner has certain rights |
| Franchise | A business that uses the name, logo and trading of an existing business |
| Joint ventures | Two or more businesses agree to work closely together on a particular project |
| Holding company | A business organization that owns and controls a number of separate businesses but doesn't unite them in one |
| Public corporation | A business enterprise owned and controlled by state |
| Different measures of size | 1number of employees 2sales turnover 3capital employed 4market share 5market capitalisation |
| Sales turnover | Total value of sales made in a period of time |
| Capital employed | The total value of all long term finance invested in the business |
| Market capitalisation | The total value of company's issued share Share price x number of shares issued |
| Market share | Sales of business as a proportion of total sales in a market Total sales of business/total sales of industry |
| Internal growth of business | Expansion of business by opening new shops,factories, branches etc. |
| External growth of business | Expansion of business due to takeovers and mergers |
| Most effective business objectives(list) | Specific Measurable Achievable Realistic Time-specific |
| Mission statement | A statement of the business aims, phrased in a way to motivate employees and stimulate the interest of people |
| Corporate social responsibility | This applies to businesses which are interested in benefiting the society by taking responsibility for the impact of their activities |
| Ethics | The moral guidelines that determine decision making |
| Ethical code | A document detailing a company's rules and guidelines on staff behaviour that must be followed by employees |
| Stakeholders | People or groups of people who are interested in the business activity |
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