Business Studies Unit 1 Flashcards

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What is a business?
An organisation that provides goods and services to customers who want or need them
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What is the difference between goods and services?
Goods are tangible items and services are activities that other people/businesses do for you
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What is the difference between a public and private sector?
A public sector is a service by government, aim to provide a service where as a private sectors aim is to make a profit
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What is an enterprise?
The skills and abilities to take risks and create profit, the creation of a business to meet the needs and wants of the customers
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What are consumer goods?
Goods provided for consumers, they may be single use like food or durables lake TV's, fridges
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What are producer goods?
Business to business goods that allow one business to help another business produce e.g machinery
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What are the factors of production?
Capital, Enterprise, Land, Labour
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What is meant by opportunity cost?
The cost of the alternative that has to be given up when a choice is made
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What is meant by a niche market?
A small part of a market that an organisation is aiming its products or services
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What is an entrepreneur?
Someone who takes the risk of starting their own business
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What is meant by the term 'patent'?
Patents make it illegal for other firms to copy directly the business idea or invention
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What are business objectives stated to be?
Specific, Measurable, Achievable, Realistic, Time bound
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What is a stakeholder?
Is an individual or organisation that is affected by the activities of a business, e.g. customers, employees, suppliers
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What is a business plan?
A document which sets out how the business is going to achieve its aims and objectives.
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What is a sole trader?
Is an individual who owns and operates the business who has unlimited liability
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What is a partnership?
Where there are two or more owners of the enterprise, usually has between 2-20 people
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What is a private limited company?
A limited company is a business that is owned by its shareholders, run by directors and whose has limited liability, shares can only be sold to friends or family or nominated individuals
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What does it mean to have limited liability?
Means that the investors can only lose the money they have invested and no more, a limited company has a separate legal identity
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What is unlimited liability?
This means that the owner has a legal obligation to pay any losses made by the business, if they can't afford it they pay it back with personal assets
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What is a franchise?
Is a marketing arrangement allowing another business to trade in the same style as an existing business
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What is a franchisee?
A person or business buying the franchise
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What is a franchisor?
The person or business who offers the franchise to other businesses its trading methods, products and business logos
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What is a royalty?
A payment made to the franchisor based on the sales turnover of the franchise
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What is market research?
Is the process of gathering and analysing information about a particular good or service
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What is the marketing mix?
Product, Price, Place and Promotion
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What is penetration pricing?
A pricing strategy when pricing is set lower than competitors
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What is price skimming?
Setting a high price for new products to help recover development costs, pricers are lowered when competitors come onto the market
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What is e-commerce?
The use of internet to buy, sell and market products
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What is finance?
The capital required to start up a business
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What is an overdraft?
Means taking more money from a band account than is in the account, usually with interest charged
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What is factoring?
Selling debt to a third party, who will then collect the debt
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What is a business angel?
A person who will invest in a new business, no equity will be required
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What is venture capital?
Finance provided by a large business
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What are fixed costs?
Costs which do not change as output changes
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What are variable costs?
Costs that change as output changes
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What are credit terms?
The amount of days to pay for goods or services
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What is a cash flow statement?
A document detailing the inflows and outflows of cash in the business
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When does overtrading happen?
Where a business attempts to grow too rapidly and cash drains out of the business and causes a negative cash flow position
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What does the term 'recruitment' mean?
The process of obtaining the right person for a job
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What is internal recruitment?
Obtaining staff from inside the business
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What is external recruitment?
Obtaining staff from outside of the organisation
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What is the different between wages and a salary?
Wages are usually paid to manual workers, they change depending on the amount of work done, where as a salary is a system based on a fixed payment, e.g monthly
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What is commission?
An additional payment for achieving a level of sales
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What are fringe benefits (non monetary)?
Given as incentives to employees, e.g company car
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What is motivation?
This is the desire to do something. People can be motivated by many factors such as fear, love, money, the the more motivated employees are the harder they will work
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What are the 5 things protecting staff through legislation?
1) Equal pay act 2) Minimum wage act 3) Discrimination legislation 4) Employment rights 5) Health and safety acts
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What is job production?
One off or small number of items produced, normally made to persons specifications (wedding dress)
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What is batch production?
Similar items which are produced together, each batch goes through 1 stage before moving onto the next (clothing)
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What is flow production?
When a product moves continuously through each production process, when one task is finished the next task must start immediately
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What does the term 'efficiency' mean?
Operating at maximum output while having the lowest costs per unit
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What is quality?
Quality is about meeting the needs and expectations of customers
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What is quality control?
The process of inspecting products to ensure that they meet the required quality standards
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What is quality assurance?
The process that ensures production quality meets the requirements of customers
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What is customer service?
The provision of service to a customer before, during and after purchase
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What does the term 'reliability' mean?
The feature of a product or service that makes a customer buy it again
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What does the term 'after sales service' mean?
The follow up service after purchase if either satisfied or not
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What is consumer protection?
Rights designed to help customers when purchasing goods or services, they provide protection is manufactured improperly
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What is brand loyalty?
What makes a customer stick to a particular brand
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What is the product life cycle?
Development, Introduction, Growth, Maturity, Saturation, Decline
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Other cards in this set

Card 2

Front

What is the difference between goods and services?

Back

Goods are tangible items and services are activities that other people/businesses do for you

Card 3

Front

What is the difference between a public and private sector?

Back

Preview of the front of card 3

Card 4

Front

What is an enterprise?

Back

Preview of the front of card 4

Card 5

Front

What are consumer goods?

Back

Preview of the front of card 5
View more cards

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samuel

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Thank you.

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