Cameroon GCE O-Level Commerce flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

Aids to trade

Services that support buying and selling by removing barriers of place, time, risk, finance and information: transport, warehousing, insurance, banking, communication and advertising. They are not trade itself.

Commerce defined

The branch of business concerned with the exchange of goods and services and the supporting services that make exchange possible, covering both home trade and foreign trade.

Division of labour

Splitting a production process into separate tasks so that each worker or firm specialises in one operation, raising output per worker but increasing boredom and interdependence between stages.

Factors of production

The four resources used to produce goods and services: land earning rent, labour earning wages, capital earning interest, and entrepreneurship earning profit.

Capital formation

The process of increasing a country's stock of capital goods through saving, mobilising those savings via financial institutions, and investing them in productive equipment and infrastructure.

Sole trader

A business owned and controlled by one person, who supplies the capital, takes all profits and bears unlimited liability for debts because there is no separate legal personality.

Partnership deed

A written agreement among partners stating capital contributed, profit-sharing ratio, duties of each partner, procedures for admitting or retiring partners and how disputes are settled.

Limited liability

A principle under which shareholders of an incorporated company can lose only the amount they invested in shares, because the company is a legal person separate from its members.

Memorandum of association

The external constitution of a company, stating its name, registered office, objects, amount of share capital and whether members' liability is limited.

Cooperative society

A voluntary association of persons who pool resources to meet common economic needs, controlled democratically on the basis of one member, one vote, with surplus shared according to patronage.

Balance of trade

The difference between the value of a country's visible exports and its visible imports of goods over a given period, excluding trade in services.

Balance of payments

A complete record of all a country's transactions with the rest of the world, covering visible trade, invisible trade and capital movements, which balances in accounting terms.

Entrepot trade

Trade in which goods are imported into a country and later re-exported, sometimes after being processed, repackaged or stored before being sold to another country.

Terms of trade

An index of export prices divided by an index of import prices, multiplied by one hundred; a rise means a country's exports buy more imports.

Channel of distribution

The route followed by goods from producer to final consumer, including any intermediaries such as agents, wholesalers and retailers, each adding services and cost.

Breaking bulk

The wholesaler's function of buying goods in large quantities from producers and dividing them into smaller lots that retailers can conveniently buy and resell.

Marketing mix

The combination of product, price, place and promotion decisions that a firm controls in order to satisfy a chosen target market profitably.

Market segmentation

Dividing a heterogeneous market into smaller groups of buyers with similar needs, such as by age, income, location or lifestyle, so each group can be served with a tailored marketing mix.

Functions of money

Money serves as a medium of exchange, a measure of value, a store of value and a standard for deferred payments, overcoming the difficulties of barter.

Lender of last resort

The central bank function of lending to commercial banks facing temporary liquidity shortages, thereby protecting the banking system from collapse.

Credit creation

The process by which commercial banks expand deposits by lending out a fraction of the money deposited with them, with total credit approximating initial deposit times one over the reserve ratio.

Commercial invoice

A document sent by the seller to the buyer after supply of goods, itemising quantity, description, unit price, total amount due and payment terms.

Credit note

A document issued by a seller to reduce the amount owed by a buyer, used when goods are returned, damaged or overcharged.

Bill of lading

A sea transport document that acts as a contract of carriage, a receipt for goods shipped and a document of title enabling the holder to claim the goods.

Insurable interest

The requirement that the person taking out insurance must stand to gain from the survival of the subject matter and lose financially from its destruction.

Principle of indemnity

The rule that insurance should restore the insured to the financial position held before the loss, not allow profit from a claim, except in life insurance.

Air transport

A fast but costly mode suited to perishable, fragile and high-value goods, useful where speed matters, but limited by capacity and dependence on airports.

Progressive tax

A tax system in which the rate rises as income rises, so higher earners pay a larger proportion of their income than lower earners.

Public finance

The study of government revenue from taxes, fees, loans and aid, and government expenditure on public services, together with the management of public debt.

Tax avoidance

Arranging one's financial affairs within the law so as to reduce tax liability, as distinct from tax evasion, which is illegal non-payment.

Consumer protection

Laws, standards and institutions that safeguard buyers against unsafe goods, false advertising, cheating on weights and measures, and unfair contract terms.

OHADA

A regional framework of harmonised business law covering company law, commercial sales and securities, applied in Cameroon and other member states to govern commercial transactions.