the reason why average costs or each item falls as a firm expands
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market share
the proportion of total market sales sold by one business
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organic growth
expansion from within the business
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external growth
expansion by merging with or taking over another business
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internet selling
marketing products through the business website
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franchisee
the firm that buys the franchise rights from the existing business
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franchisor
the existing firm that sells rights to another business
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merger
an agreement between business owners to combine two business and operate as a larger one
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takeover
purchasing another business from its owners
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horizontal integration
joining two businesses in the same industry and stage of production
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vertiacl backward integration
joining two businesses in the same industry but at different stage of production
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diversification
joining two businesses in different industries
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limited company
a business recognised as a legal unit that offers investors (shareholders )limited liability
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shareholders
part owners of limited company
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private limited company LTD
a company that cannot sell shares to the general public. It is not listed on the Stock Exchange
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public limited company PLC
a company able to sell shares to the general public by being listed
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Limited liability
investors in a limited company can only lose their investment in the business if it fails, they cannot be forced to sell assets to pay of the firms debts
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shareholders
part owners of a limited company
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dividend
payment made to shareholders from company profits
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divorce between ownership and control
when directors control a PLC and thousands of shareholders own it, but the two groups may have different objectives
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ethical objectives
a business aim to do the right thing
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enviromental objectives
a business aim to protect the enviroment during oberations
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social benefits
the benefits of a business activity, not just to the firm but to society
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social costs
the costs of business activity including both financial and society
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globalisation
increasing trend for goods to be traded for goods traded internationally and for companies to locate abroad
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off-shoring
making products or parts of produts on other countries. services can be off-shored too such as telephone call centres
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multnational
a business with operations in more than one country
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Other cards in this set
Card 2
Front
the proportion of total market sales sold by one business
Back
market share
Card 3
Front
expansion from within the business
Back
Card 4
Front
expansion by merging with or taking over another business
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