Unit 1 - Business Organisation Flashcards Preview

IB Business Management HL 2016+ > Unit 1 - Business Organisation > Flashcards

Flashcards in Unit 1 - Business Organisation Deck (94)
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31

forward vertical integration

business buys a firm operating in a later stage of production, e.g. firm buys costumer

32

franchise

agreement between a franchisor selling its rights to other businesses to allow them to sell products under its name in return for a fee, e.g. McDonald’s, Subway, Benetton

33

free trade

trade without trade barriers

34

globalization

integration and interdependence of economic, social, technical and cultural issues of the world’s economies

35

Gross Domestic Product (GDP)

total value of all goods and services produced in an economy in one year

36

horizontal integration

business buys a firm operating in the same stage of production, e.g. firm buys competitor

37

inflation

steady increase in the price level

38

interest rate

price of borrowed money

39

internal growth

business grows by using its own resources to increase the scale of its operations and sales revenue

40

internal stakeholders

are members of the organisation, e.g. employees, shareholders, managers

41

joint venture

two or more different organisations share costs, risks, control and rewards and form a separate legal enterprise, e.g. Sony-Ericsson

42

labour

physical and mental effort

43

land

all natural resources, e.g. land itself, water, wood

44

limited liability

restriction on the amount of money the owners of a company can lose if the business goes into bankruptcy

45

market development

growth strategy that involves selling existing products in new markets

46

market penetration

growth strategy that involves selling more existing products in existing markets

47

merger

form of external growth whereby two or more firms agree to form a new organisation

48

mission statement

declaration of an organisation’s overall purpose

49

multinational corporations (MNCs)

companies that operate production or service facilities outside their home country

50

non-governmental organisations (NGOs)

private sector organisations that operate for the benefit of others rather than aiming to make a profit, e.g. Oxfam, Amnesty International

51

objectives

short-term targets of an organisation

52

partnerships

form of business owned by 2 – 20 people with shared responsibilities and burdens of running and owning the business

53

PEST analysis

decision-making framework used to analyse the opportunities and threats of the political, economic, social and technological environment

54

pressure groups

individuals with a common concern who seek to place demands on organisations to act in a particular way or to influence a change in their behaviour

55

primary sector

cultivation or extraction of natural resources, e.g. farming, mining, fishing, forestry

56

private limited company

business owned by shareholders with limited liability but whose shares cannot be bought by or sold to the general public

57

private sector

part of the economy under the control of private individuals or businesses

58

product development

growth strategy that involves selling new products in existing markets

59

protectionism

any measure taken by a government to protect the domestic industry from foreign competition

60

public corporations

organisations wholly owned by the government