Business Studies

• Productivity is output measured against the inputs used to create it.
• Buffer inventory is inventory held to deal with uncertainty in customer demand and deliveries of supplies.
• Lean production is a term used by business to cut down waste which increases its efficiency.
• Kaizen is a Japanese term meaning 'continuous improvement' through the elimination of waste.
• Just-In-Time is a production method that involves reducing the need to hold inventories of raw materials.
• Job production is a single product made at a time.
• Batch production is a quantity of product is made, then a quantity of another product is made.
• Flow production is large quantities of a product is made in a continuous process. This is also known as mass production.
• Fixed costs do not vary in the short run with number of items sold or produced. It has to be paid whether or not the business is making any sales or not.
• Variable costs varies directly with the number of items sold or produced.
• Total costs is the combination of fixed and variable costs.
• Average costs per unit is the total cost of production divided by the total output. This also sometimes reffers to unit cost.
• Economies of scale is a factor that lead to a reduction in average costs as the business increase in size.
• Diseconomies of scale is a factor that lead to an increase in average costs as a business grows beyond the current size.
• Break-even level of outputs is a quantity that must be produced or sold for total revenue to equal total costs. Also known as break-even point.
• Break-even chart is a graph which shows how cost and revenue of a business changes with sales.
• Revenue is the income during a period of time from the sales of goods and services. Total revenue = Quantity sold x Price
• Break-even point is the level of sales at which total costs = total revenue.
• Margin of safety is the amount of sales at which surpass the break-even point.
• Contribution is the selling price less its variable costs.
• Quality is when it produces goods and services at which meets the needs and expectations of the customer.
• Quality control is checking for the quality at the end of the production process.
• Quality assurance is checking for the quality standards throughout the production process by employees.
• Total Quality Management is the continuous improvement of products by focusing on quality at every stage of production.