Other
IGCSE Business Studies Glossary
- Course
- Institution
This Business glossary covers all the definitions found on the Cambridge IGCSE Business Studies specification (0450).
[Show more]
Seller
Follow
suhayb
Reviews received
Content preview
CIE IGCSE Business Studies GlossarySection 1: Understanding Business Activity
Need
A good or service that is essential for living.
Want
A good or service that people would like to have but is not necessary for living. People
have unlimited wants.
Economic problem
There are unlimited wants but limited resources to produce the goods and services to
satisfy wants. This creates scarcity.
Factors of production
Resources needed to produce goods and services. There are 4 factors of production (land,
labour, capital, enterprise) and they are limited in supply.
Scarcity
The lack of sufficient products to fulfil the total wants of the population.
Opportunity Cost
The next best alternative given up by choosing another item.
Specialization
When people and businesses concentrate on what they are best at.
Division of labour
When the production process is split up into different tasks and each worker performs one
of these tasks. It is a form of specialization.
Business
Combines factors of production to make products (goods and services) which satisfy
people's wants.
Added Value
It is the difference between the selling price of a product and the cost of bought in
materials and components.
Primary Sector
Extracts and uses natural resources to produce raw materials used by other businesses.
Secondary Sector
Manufactures goods using raw materials provided by Primary Sector.
Tertiary Sector
Provides services to customers and other sectors of industry.
De-industrialization
There is a decline in the importance of the secondary, manufacturing sector of industry in
a country.
, Mixed Economy
Has both a private sector and a public sector.
Private Sector
Businesses not owned by government. Make their own decision about selling price. Aim
to run profitably. Some government control.
Public Sector
Government-owned, controlled businesses and organizations. Decide which price to
charge consumers. Different aim from Private Sector.
Capital
Money invested into business by owners.
Entrepreneur
A person who organizes, operates and takes the risk for a new business venture.
Business Plan
Document containing the business objectives and important details about the operations,
finance and owners of the new businesses.
Capital Employed
Total value of capital used in the business.
Internal Growth
When a business expands its existing operations.
External Growth
When a business takes over or merges with another business.
Integrations/Merger
When two businesses agree to join their firms together to make one business.
Takeover/Acquisition
One business buys out the owners of another business which then becomes part of the
'predator' business
Horizontal Integration
When one company merges with or takes over another in the same industry in the same
stage of production.
Vertical Integration
When one company merges with or takes over another in the same industry but at a
different stage of production.
Conglomerate Integration/Diversification
When one company merges with or takes over another in a completely different industry.
Sole Trader
Business owned by one person
Limited Liability
The liability of shareholders in a company is only limited to the amount they invested.
Unlimited Liability
The owners of a business can be held responsible for the debts of the business they own.
Their liability is not limited to the investment they make.
Partnership
A form of business in which two or more people agree to jointly own a business.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller suhayb. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $4.85. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
48298 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 15 years now