JCE Business Studies flashcards

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

Budget surplus

The amount by which total income exceeds total expenditure in a given period. A surplus can be saved, invested or used to repay debt.

Compound interest

Interest calculated on both the original principal and previously accumulated interest, so the balance grows faster than under simple interest over the same period and rate.

Net pay

The amount an employee actually receives after statutory and voluntary deductions such as income tax, social security contributions and pension contributions are subtracted from gross pay.

APR

Annual Percentage Rate: the yearly cost of credit expressed as a percentage, including interest and certain fees, allowing borrowers to compare loans on a like-for-like basis.

Consumer right to redress

The right to a remedy such as repair, replacement, refund or compensation when goods or services are faulty, unsafe, misdescribed or not fit for their stated purpose.

Merchantable quality

A legal standard requiring goods sold to be reasonably fit for their ordinary purpose, free from significant defects, and acceptable given the price and description.

Cooling-off period

A statutory window during which a consumer may cancel certain contracts, typically distance or door-to-door sales, without penalty and often without giving a reason.

Unfair trade practice

A selling practice that misleads or deceives consumers, such as false claims, bait advertising, fake discounts or concealed contract terms, and is prohibited by consumer-protection law.

Unlimited liability

A legal position where the owner is personally responsible for all business debts, so personal assets may be seized to satisfy claims the business cannot pay.

Private limited company

A business with separate legal personality and limited liability whose shares are held privately and cannot be offered for sale to the general public.

Span of control

The number of subordinates directly supervised by one manager. A wide span produces a flatter structure; a narrow span produces more management layers.

Cooperative

A business owned and democratically controlled by its members, usually on a one-member-one-vote basis, with surplus distributed according to member patronage rather than shareholding.

Accounting equation

Assets equal liabilities plus owner's equity. Every transaction affects at least two elements while keeping this relationship balanced under double-entry bookkeeping.

Gross profit margin

Gross profit divided by revenue, expressed as a percentage. It shows how much of each sales dollar remains after the direct cost of goods sold.

Break-even output

The number of units that must be sold for total revenue to equal total costs, calculated as fixed costs divided by contribution per unit (price minus variable cost).

Working capital

Current assets minus current liabilities. It measures the short-term funds available to finance day-to-day operations such as paying suppliers and wages.

Cash flow forecast

A projection of expected cash receipts and payments by period, used to anticipate shortfalls. It differs from profit because it records timing of cash, not accrual.

Market segmentation

Dividing a broad market into groups of buyers with similar needs or characteristics, such as by age, income, location or lifestyle, so marketing can be targeted.

Penetration pricing

Setting a low introductory price to attract customers quickly and build market share, often later raised once the product is established and repeat purchase occurs.

Marketing mix

The combination of product, price, place and promotion used to position an offer in its target market; service businesses add people, process and physical evidence.

Market share

A firm's sales divided by total sales in the market, expressed as a percentage. It indicates competitive strength and is tracked over time.

Induction training

Introductory training given to new employees covering company policies, health and safety, workplace culture, job expectations and key colleagues, helping them settle quickly.

Labour turnover

The rate at which employees leave and are replaced, calculated as leavers divided by average workforce, multiplied by one hundred. High rates raise recruitment costs.

Herzberg two-factor theory

Herzberg argued that hygiene factors such as pay and conditions prevent dissatisfaction, while separate motivators such as achievement and recognition create genuine job satisfaction.

On-the-job training

Training delivered in the normal workplace while the employee performs real tasks, often through coaching, mentoring or job rotation. It is practical but may pass on bad habits.

Just-in-time production

A system where materials and components arrive only as needed for production, minimising stock-holding costs but increasing vulnerability to supply disruptions.

Productivity

Output produced per unit of input, such as units per worker-hour. Rising productivity lowers average cost per unit provided quality and demand are maintained.

Capacity utilisation

Actual output divided by maximum possible output, expressed as a percentage. Low utilisation spreads fixed costs over fewer units and raises unit cost.

Total quality management

An approach in which every employee pursues continuous improvement and zero defects, using customer feedback, employee involvement and process measurement rather than end-of-line inspection alone.

Business plan

A written document setting out the business idea, market analysis, marketing and operations plans, management team and financial forecasts, used to guide the owner and attract finance.

SMART objectives

Targets that are specific, measurable, achievable, relevant and time-bound, giving a business clear criteria against which performance can be reviewed.

Venture capital

Long-term equity finance provided by specialist investors to high-growth, higher-risk businesses, usually in exchange for shares and some influence over strategy.