Business Component 2

?
The process of transforming raw data into usable information in order to present, interpret and analyse a business situation
Data Analysis
1 of 56
The process of collecting information about the market the business is operating in, in order to create effective objectives to ensure success
Market Analysis
2 of 56
Measures the responsiveness of demand after a change in price
PED
3 of 56
Measures the responsiveness of demand after a change in customer income
YED
4 of 56
These have a positive income elasticity of demand and there is a shift to the left in the demand curve. This means as incomes rise so does the demand at each price
Normal goods
5 of 56
A fall in real GDP for two consecutive periods of 6 months. There is a large decline in economic activity across an economy.
Recession
6 of 56
A percentage of their earnings a person pays to the government to fund public services
Income tax
7 of 56
A prediction of sales revenue based on the historical number of sales made and current market research and trends
Sales forecast
8 of 56
The process of predicting what a business's future sales will be
Sales forecasting
9 of 56
An estimate of income and expenditure for a business covering a set period of time
Budget
10 of 56
One of a succession of averages of data, where each average is calculated by successively shifting the interval by the same period of time
Moving average
11 of 56
A line that goes roughly through the middle of all the scatter points on a scatter graph. The closer the points are to the line of best fit, the stronger the correlation
Line of best fit
12 of 56
A method that allows a business to predict future levels of sales from past figures
Time series analysis
13 of 56
As estimate of income and expenditure for a business covering a set period of time
Budget
14 of 56
The difference between the budgeted amount and actual amount for each item in a budget
Variances
15 of 56
Cash or other assets that can be converted into cash within 12 months
Current assets
16 of 56
The amounts due to be paid out within 12 months
Current liabilities
17 of 56
The cash needed to pay for the day-to-day operation of the business
Working capital
18 of 56
The period of time between the point at which cash is first spent on production of a product and the collection of cash from the customer
Working capital cycle
19 of 56
The share capital, retained earnings and long-term borrowings of a business
Capital employed
20 of 56
An amount deducted from the original cost of an asset to take into account the wear and tear in its use over time
Depreciation
21 of 56
A measure of the extent to which a business has cash to meet its immediate and short-term obligations, or assets that can be quickly converted into cash to do this
Liquidity
22 of 56
A financial ratio measuring what returns the business has made on the resources available to it
ROCE
23 of 56
How much profit in total the business has made from its trading activities before any account is taken of how the business is financed
Operating profit
24 of 56
Shareholders funds + long term liabilities. It is the amount of share capital and debt that a company has and uses.
Capital employed
25 of 56
Debts payable by a business after 12 months, such as a mortgage or a bank loan.
Non-current liabilities
26 of 56
The proportion of finance that is provided by debt relative to all the long-term finance within the business
Gearing
27 of 56
A goal set by a business, usually in the medium to long term
Business objective
28 of 56
A target for an individual department such as marketing, so that staff can ensure that the corporate objective is achieved.
Functional objective
29 of 56
Sets out what the business desires in the long term and the key activities that will achieve this
Vision statement
30 of 56
A short statement of a business's vision and values which helps to set its aim and objectives
Mission statement
31 of 56
A generalised statement of what the business plans to achieve in the longer term
Aim
32 of 56
Defines the overall purpose and scope of the business to meet stakeholder expectations
Corporate strategy
33 of 56
The smaller steps and shorter-term goals that help achieve the strategy of the business
Tactics
34 of 56
A method for analysing a business, its resources and its environment. It is used to identify a business's internal strengths and weaknesses and its external opportunities and threats
SWOT analysis
35 of 56
A model for analysing the nature of competition within an industry or market
Porter's five forces framework
36 of 56
A cost related to a business wanting to enter a market which is not incurred currently by those businesses already in the market
Barrier to entry
37 of 56
A strategic marketing planning tool that links a business's marketing strategy to its general strategic direction
Ansoff's matrix
38 of 56
The growth in revenues and profits that arises when a business expands its existing operations rather than completing a merger or takeover
Organic growth
39 of 56
Where the business attempts to grow by completing a merger or takeover
External growth
40 of 56
The combination of two separate businesses into a new business
Merger
41 of 56
Where one business acquires a controlling interest in another business
Takeover
42 of 56
Where two businesses operating in the same industry and at the same stage in the supply chain become one business
Horizontal integration
43 of 56
Where a business acquires another business in the same market but at a different stage in the supply chain
Vertical integration
44 of 56
When a business reorganises its production in order to increase its productivity and efficiency
Rationalisation
45 of 56
A business gets another business to do its work for it, in the same or a different country
Outsourcing
46 of 56
A mathematical model that uses estimates and probabilities to calculate likely outcomes in order to help a business decide whether a net gain from a decision is worthwhile
Decision tree
47 of 56
A technique that is used to find the cheapest or fastest way to complete a task
CPA
48 of 56
The amount of time in a CPA network that a task can be delayed without causing a delay without causing a delay to the following tasks
Float time
49 of 56
A method for measuring the financial feasibility of a project by quantifying costs and benefits including external costs and benefits
CBA
50 of 56
The amount of time it takes for a business to recover the initial amount invested
Payback
51 of 56
The average annual return on an investment for a project expressed as a percentage
ARR
52 of 56
The process of calculating the present value of an investment's future cash flows in order to arrive at a current value of the investment, known as the net present value
DCF
53 of 56
The present value of all the money coming in from a project in the future set against the money invested today
NPV
54 of 56
A one-off order requested specially by a customer
Special order
55 of 56
The difference between the selling price and the variable costs of production
Contribution
56 of 56

Other cards in this set

Card 2

Front

The process of collecting information about the market the business is operating in, in order to create effective objectives to ensure success

Back

Market Analysis

Card 3

Front

Measures the responsiveness of demand after a change in price

Back

Preview of the front of card 3

Card 4

Front

Measures the responsiveness of demand after a change in customer income

Back

Preview of the front of card 4

Card 5

Front

These have a positive income elasticity of demand and there is a shift to the left in the demand curve. This means as incomes rise so does the demand at each price

Back

Preview of the front of card 5
View more cards

Comments

No comments have yet been made

Similar Business Studies resources:

See all Business Studies resources »See all Component 2 resources »