Economics Overview: Key Concepts and Sectors

A merger involves two businesses agreeing to join together, while a takeover is when one business buys out another.

Horizontal integration is when one business merges with or takes over another in the same industry at the same production stage, for example, a car manufacturer acquiring another car manufacturer.

Limited liability means that shareholders are only responsible for the company's debts up to the amount they have invested.

<p>Conglomerate integration occurs when one business merges with or takes over a business in a completely different industry, also known as diversification.</p> Signup and view all the answers

<p>An unincorporated business is one without a separate legal identity, such as a sole trader or partnership.</p> Signup and view all the answers

<p>Shareholders in a public limited company own shares that represent part-ownership of the company and can sell their shares publicly on the Stock Exchange.</p> Signup and view all the answers

<p>An AGM is important as it is a legal requirement where shareholders can attend, vote on the Board of Directors, and discuss company performance.</p> Signup and view all the answers

<p>Scarcity is the lack of sufficient products to fulfill the total wants of the population, making it crucial in economics as it drives the need for resource allocation and prioritization.</p> Signup and view all the answers

<p>Dividends are payments made to shareholders from a company's profits after tax, typically distributed based on the number of shares owned.</p> Signup and view all the answers

<p>Opportunity cost is the next best alternative given up when a choice is made, and it affects decision-making by highlighting the potential benefits lost from not selecting the alternative.</p> Signup and view all the answers

<p>The primary sector extracts natural resources, the secondary sector manufactures goods from those resources, and the tertiary sector provides services to consumers and businesses.</p> Signup and view all the answers

<p>An entrepreneur organizes, operates, and takes risks for a new business venture, driving innovation and economic growth.</p> Signup and view all the answers

<p>Specialization occurs when individuals or businesses focus on what they do best, leading to increased efficiency and productivity in the production process.</p> Signup and view all the answers

<p>Added value is the difference between the selling price of a product and the cost of bought-in materials, and it is important because it indicates the profitability of a product.</p> Signup and view all the answers

<p>Internal growth occurs when a business expands its existing operations, such as increasing production capacity or opening new locations.</p> Signup and view all the answers

<p>A mixed economy includes both a private sector and a public (state) sector, combining elements of capitalism and socialism.</p> Signup and view all the answers

<p>To allow an individual or entity, the franchisee, to operate a business using the established brand and methods of the franchisor.</p> Signup and view all the answers

<p>They share capital, risks, and profits to work on a new project together.</p> Signup and view all the answers

<p>Market share is the percentage of total market sales held by a brand, indicating its competitive position in the market.</p> Signup and view all the answers

<p>A social enterprise has social objectives in addition to profit-making, aiming to reinvest profits back into its social mission.</p> Signup and view all the answers

<p>Job enrichment focuses on adding more skill and responsibility to tasks, while job rotation involves changing tasks among workers.</p> Signup and view all the answers

<p>Motivation drives employees to work hard and effectively towards achieving the business's goals.</p> Signup and view all the answers

<p>Profit sharing involves distributing a portion of a company's profits to its employees as a reward for their contribution.</p> Signup and view all the answers

<p>Commission is a payment based on the number of sales an employee makes.</p> Signup and view all the answers

<p>A need is essential for living, while a want is a good or service that is not essential.</p> Signup and view all the answers

<p>Scarcity arises when there are unlimited wants but limited resources available to satisfy those wants.</p> Signup and view all the answers

<p>Opportunity cost is the next best alternative foregone when making a choice, and it helps individuals and businesses consider what they are giving up.</p> Signup and view all the answers

<p>The four factors of production are land, labor, capital, and entrepreneurship.</p> Signup and view all the answers

<p>Division of labor splits production into different tasks, allowing workers to specialize and perform tasks more efficiently.</p> Signup and view all the answers

<p>Added value is the difference between the selling price and the cost of materials, and it represents the benefit gained from the production process.</p> Signup and view all the answers

<p>A mixed economy combines both private sector operations and public (state) sector involvement.</p> Signup and view all the answers

<p>Internal growth occurs when a business expands its existing operations, such as increasing production capacity or opening new locations.</p> Signup and view all the answers

<p>A social enterprise aims to achieve social objectives while also making a profit to reinvest back into the business.</p> Signup and view all the answers

<p>Stakeholders can impact performance through their direct interests and actions regarding the company's activities and results.</p> Signup and view all the answers

<p>Market share indicates the percentage of total market sales held by a business, which reflects its competitiveness and market position.</p> Signup and view all the answers

<p>A public corporation is a business owned and controlled by the state or government.</p> Signup and view all the answers

<p>Job satisfaction is the enjoyment an employee derives from feeling that they have done a good job.</p> Signup and view all the answers

<p>A wage is typically paid weekly based on hours worked, while a salary is a fixed payment usually made monthly.</p> Signup and view all the answers

<p>Training is the process of improving a worker's skills to enhance their performance on the job.</p> Signup and view all the answers

<p>Team working involves groups of workers collaborating on specific tasks, enhancing productivity and creativity.</p> Signup and view all the answers

<p>Horizontal integration involves merging with or taking over a competitor in the same industry at the same production stage, while vertical integration involves merging at different stages of production within the same industry.</p> Signup and view all the answers

<p>A partnership agreement is a legal document outlining the terms between business partners. While it is not essential, it helps prevent disputes and clarifies each partner's responsibilities.</p> Signup and view all the answers

<p>Limited liability means that shareholders are only financially responsible for the company's debts up to the amount they invested in shares.</p> Signup and view all the answers

<p>A sole trader is an individual who owns and operates a business independently. Unlimited liability means the owner is personally responsible for all business debts, putting personal assets at risk.</p> Signup and view all the answers

<p>Private limited companies cannot sell shares to the public and are owned by a small group of shareholders, whereas public limited companies can sell shares to the public and their shares are traded on stock exchanges.</p> Signup and view all the answers

<p>Conglomerate integration occurs when a business merges with or acquires a company in a completely different industry. Companies pursue it to diversify their operations and reduce risks associated with reliance on a single industry.</p> Signup and view all the answers

<p>Dividends are payments made to shareholders from a company's profits as a return on their investment.</p> Signup and view all the answers

<p>An incorporated business has a separate legal identity from its owners, whereas an unincorporated business does not, meaning its owners are personally liable for business debts.</p> Signup and view all the answers