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Business Studies Definitions

Unit 1:

Entrepreneur: an individual with a flair for business opportunities and risk taking. The term is often
used to describe a person with the entrepreneurial spirit to set up a new business.

Profit: what is left from revenue after costs have been deducted. There are many…

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Other Factors

Factors that effect Supply:
Price of the commodity
Price of factors of production
Price of related goods

Market Orientation: businesses setting the wishes of customers and what they are willing to pat as
the top priority to guide production and marketing decisions.

Market Research (Primary &…

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Structural, i.e. when the economy changes in a fundamental way and people are made
unemployed. The coal and shipbuilding industries of the UK are examples.
Cyclical, i.e. when demand is low at the bottom of the trade cycle.

Inflation: is a sustained rise in the average prices of goods within…

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Gross/Net Profit Margin (Ratio): is the percentage of sales revenue which is gross profit/net profit.

Business Plan: a report detailing the marketing strategy, production costings and financial
implications of a business startup. The plan is is useful for helping the entrepreneur to think his or
her idea through, though it…

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Span of Control: the number of subordinates answerable directly to the manager. It can be
described as `wide' if the manager has many direct subordinates or `narrow' if there are a few.

Chain of Command: is a vertical line of authority within an organisation enabling orders to be
passed down…

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Niche Marketing: a corporate strategy based on identifying and filling relatively small market
segments. This can enable small firms to operate profitably in markets dominated by large

Research & Development: means scientific research and technical development. This is directed
at improving the product, rather than finding out what the…


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