A2 Definitions
Definitions
1. Globalisation – the increasing freedom of movement of goods, capital and
people around the world
2. Free trade – no restrictions or trade barriers exist that might prevent or
limit trade between countries
3. Tariffs – taxes imposed on imported goods to make them more expensive
than they would otherwise be
4. Quotas – limits on the physical quantity or value of certain goods that may
be imported
5. Voluntary export limits – an exporting country agrees to limit the quantity
of certain goods sold to one country (possibly to discourage the setting of
tariffs/quotas)
6. Protectionism – using trade barriers to free trade to protect a country’s
own domestic industries
7. Multinational business – business organisation that has its headquarters
in one country, but with operating branches, factories and assembly
plants in other countries
8. Privatisation – selling state-owned and controlled business organisations
to investors in the private sector
9. External growth – business expansion achieved by means of merging with
or taking over another business, from either the same or different
industry
10.Merger – an agreement by shareholders and managers of two businesses
to bring both firms together under a common board of directors with
shareholders in both businesses owning shares in the newly merged
business
11.Takeover – when a company buys more than 50% of the shares of another
company and becomes the controlling owner of it – often to as
‘acquisition’
12.Synergy – literally means that ‘the whole is greater than the sum of parts’,
so in integration it is often assumed that the new, larger business will be
more successful than the two formerly separate, businesses were
13.Monopoly – theoretically a situation in which there is only one supplier,
but this is very rare: for government policy purposes this is usually
redefined as a business controlling at least 25% of the market
, 14.Social audit – a report on the impact a business has on society – this can
cover pollution levels, health and safety record, sources of supplies,
customer satisfaction and contribution to the community
15.Information technology – the use of electronic technology to gather, store,
process and communicate information
16.Innovation – creating more effective processes, products or ways of doing
things in a business
17.Computer-aided design (CAD) – using computers and IT when designing
products
18.Computer-aided manufacturing (CAM) – the use of computers and
computer-controlled machinery to speed up the production process and
make it more flexible
19.Environmental audits – assess the impact of a business’s activities on the
environment
20.Social audit – a report on the impact a business has on society. This can
cover pollution levels, health and safety record, sources of supplies,
customer satisfaction and contribution to the community
21.Pressure groups – organisations created by people with a common
interest or aim who put pressure on businesses and governments to
change policies so that an objective is reached
22.Economic growth – an increase in a country’s productive potential
measured by an increase in its real GDP
23.Gross domestic product (GDP) – the total value of goods and services
produced in a country in one year – real GDP has been adjusted for
inflation.
24.Business investment – expenditure by businesses on capital equipment,
new technology and research and development
25.Business cycle – the regular swings in economic activity, measured by real
GDP, that occur in most economies, varying from boom conditions (high
demand and rapid growth) to recession when total national output
declines
26.Recession – a period of six months or more of declining real GDP
27.Inflation – an increase in the average price level of goods and services – it
results in a fall in the value of money
28.Deflation – a fall in the average price level of goods and services
29.Working population – all those in the population of working age who are
willing and able to work
30.Unemployment – this exists when members of the working population are
willing and able to work, but are unable to find a job
Definitions
1. Globalisation – the increasing freedom of movement of goods, capital and
people around the world
2. Free trade – no restrictions or trade barriers exist that might prevent or
limit trade between countries
3. Tariffs – taxes imposed on imported goods to make them more expensive
than they would otherwise be
4. Quotas – limits on the physical quantity or value of certain goods that may
be imported
5. Voluntary export limits – an exporting country agrees to limit the quantity
of certain goods sold to one country (possibly to discourage the setting of
tariffs/quotas)
6. Protectionism – using trade barriers to free trade to protect a country’s
own domestic industries
7. Multinational business – business organisation that has its headquarters
in one country, but with operating branches, factories and assembly
plants in other countries
8. Privatisation – selling state-owned and controlled business organisations
to investors in the private sector
9. External growth – business expansion achieved by means of merging with
or taking over another business, from either the same or different
industry
10.Merger – an agreement by shareholders and managers of two businesses
to bring both firms together under a common board of directors with
shareholders in both businesses owning shares in the newly merged
business
11.Takeover – when a company buys more than 50% of the shares of another
company and becomes the controlling owner of it – often to as
‘acquisition’
12.Synergy – literally means that ‘the whole is greater than the sum of parts’,
so in integration it is often assumed that the new, larger business will be
more successful than the two formerly separate, businesses were
13.Monopoly – theoretically a situation in which there is only one supplier,
but this is very rare: for government policy purposes this is usually
redefined as a business controlling at least 25% of the market
, 14.Social audit – a report on the impact a business has on society – this can
cover pollution levels, health and safety record, sources of supplies,
customer satisfaction and contribution to the community
15.Information technology – the use of electronic technology to gather, store,
process and communicate information
16.Innovation – creating more effective processes, products or ways of doing
things in a business
17.Computer-aided design (CAD) – using computers and IT when designing
products
18.Computer-aided manufacturing (CAM) – the use of computers and
computer-controlled machinery to speed up the production process and
make it more flexible
19.Environmental audits – assess the impact of a business’s activities on the
environment
20.Social audit – a report on the impact a business has on society. This can
cover pollution levels, health and safety record, sources of supplies,
customer satisfaction and contribution to the community
21.Pressure groups – organisations created by people with a common
interest or aim who put pressure on businesses and governments to
change policies so that an objective is reached
22.Economic growth – an increase in a country’s productive potential
measured by an increase in its real GDP
23.Gross domestic product (GDP) – the total value of goods and services
produced in a country in one year – real GDP has been adjusted for
inflation.
24.Business investment – expenditure by businesses on capital equipment,
new technology and research and development
25.Business cycle – the regular swings in economic activity, measured by real
GDP, that occur in most economies, varying from boom conditions (high
demand and rapid growth) to recession when total national output
declines
26.Recession – a period of six months or more of declining real GDP
27.Inflation – an increase in the average price level of goods and services – it
results in a fall in the value of money
28.Deflation – a fall in the average price level of goods and services
29.Working population – all those in the population of working age who are
willing and able to work
30.Unemployment – this exists when members of the working population are
willing and able to work, but are unable to find a job
