Key terms

Cards (29)

  • Aim
    Intention to reach a goal
  • Business plan
    Detailed statement about how the business intends to operate at the start of the business or during a given period of time.
  • Chain of command
    Line of hierarchy that shows who is responsible from top to bottom
  • Consumer law
    Laws designed to ensure that business makes products that are safe and of good quality and treat customers fairly
  • Cost
    The money spent by the business on goods and services
  • Decentralisation
    Where authority is spread widely through a business
  • Centralisation
    Maintaining control by keeping authority at senior levels of the organisation
  • Delegation
    Allocating a task to someone who wouldn’t usually do it
  • Directors
    People who are elected by shareholders to run the business on their behalf
  • Variable costs
    Costs that change as the business output changes
  • Unlimited liability
    When the owner is responsible for all debts of the business
  • Limited liability
    When Owners are not responsible for debts of the business and is the amount of money they invested in the business
  • loan
    A fixed sum of money borrowed for a specified period of time at an agreed rate of interests;repaid in instalments
  • Interest rates
    Rate charged for borrowing money over a period of time
  • What are the two types of sectors
    Private
    public
  • What is a private sector
    A business that is individually owned and operated too Make profit
  • What is a public sector
    A business that is owned by the government and usually provides service such as healthcare and education
  • three types of business activity 

    Primary
    secondary
    tertiary
  • What is a primary industry
    A business that extracts the earths natural resources
  • What is a secondary industry
    A business that uses raw materials to manufacture goods or construct items
  • What is a Tertiary industry
    A business that provides services to consumers or other businesses
  • What is a share issue 

    Long term source of finance hat is only available to limited companies
  • What is the process of conflict between stakeholder objectives is minimised but not completely removed is called 

    Conflict management
  • What does an income statement show
    Revenue and expenses
  • What is a tall organisational structure 

    Has many levels of hierarchy but a narrow span of control therefore is opportunities for promotion
  • What is a flat organisational structure
    Has a few levels of hierarchy and a wide span of control
  • What is a matrix organisational structure
    Structure where teams repirt to multiple leaders
  • Advantages of a flat organizational structure


  • Disadvantages of a talk organisational structure 

    Slow decision-making, lack of flexibility, communication challenges, and higher costs.