Key Terms in Business and Economics

Some key terms necessary of the edexcel exams at AS level Unit 2

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  • Created by: Sophie
  • Created on: 16-01-12 09:27

1. Abnormal Profit

  • is any level of profit over and above normal profit
  • the idea that it is consumers, who, by their buying decisions, determine what goods/services are produced and how limited resources are used
  • time of rapid growth and expansion in the economy
  • where two large firms dominate the market
  • a reduction in average cost brought about by an increase in the size of the business
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2. Capactiy utilisation

  • anything that prevents firms from entering the market, including start-up costs, branding, patents ect.
  • how resources are shared out in and economic system
  • measures what proportion of the theoretical maximum possible outpt is actually produced
  • reducing the number of levels in an organisation
  • large amounts of capital and relatively little labour

3. Consumer sovereignty is were attitudes, customs and expectations influence the way decisions are made within a business

  • False
  • True

4. Cyclic unemployment

  • when people are in between jobs
  • occurs when there is a seasonal variation in demand
  • caused by a downturn in the economic cycle
  • the rate of unemployment in different areas of the Uk
  • when people have the wrong skills for the employment on offer

5. Seasonal Unemployment

  • caused by a downturn in the economic cycle
  • the rate of unemployment in different areas of the Uk
  • when people have the wrong skills for the employment on offer
  • occurs when there is a seasonal variation in demand
  • when people are in between jobs
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