Business Paper 1 Complete Terms Definitions for Exam Revision Exercise

1. Sole trader - AnsAn individual who owns and operates his or her own business. A sole trader is unincorporated meaning that the firm's finances are inseparable from those of the owner who has unlimited liability. Mr Carroccio believed that operating as a sole trader would be the best way to achieve financial security. Alejandra also originally operated as a sole trader when the business was not so big. 2. Business - Ansorganizations that are involved in the production of a good or a service to satisfy a need or a want. Mr Carroccio wanted to set up his own business upon his arrival to the USA. Alejandra's business provides goods (such as LadyA perfume and cosmetics) and services (such as music and concert). 3. Cash-flow forecasts (7) - Ansa financial document giving detailed estimates of a firm's future cash inflows and outflows per month. Mr Carroccio initially got turned down several times for bank loans because of weak. 4. Bank loans (9) - AnsA fixed amount of money borrowed from a bank with regular fixed repayments, including interest payments, over a defined period. (X) are generally offered by banks against some security or collateral from the borrower. Mr Carroccio was unsuccessful in obtaining bank loans when he first arrived in the USA due to his weak cash-flow forecasts. 5. Entrepreneurs (9) - AnsA person who has a flair for business and risk taking. S/he organizes factors of production to produce a good or a service. The (X) sets up a business and assumes the risks and rewards of running a business. Mr Carroccio obtained a grant from a government agency that helped (X). Alejandra is also an (X), owing 98% of the shares in LadyA Management Limited. 6. Charity (11) - AnsA non-profit organization set up to provide help and raise money for those in need. Mrs Carroccio attended English classes organized by a local (X) when she first went to the USA in 1973. If LadyA pursues Option 3, she would set up her own (X) for a charitable cause, such as tackling issues of malnutrition in low-income countries. 7. Non-profit organization (11) - Ansprivate sector organizations that do not aim to make a profit but operate for the benefit of others in society. Mrs Carroccio attended English classes organized by a local charity, a (X), to help adult immigrants learn English. 8. Mission statement (11) - AnsThe declaration of a business's overall goal and its purpose. It forms the foundation for setting the objectives of a business. The(X) of the charity that Mrs Carroccio attended English classes was "to help all adult immigrants learn English". 9. Wage (13) - AnsA fixed regular payment earned for work or services provided by an employee especially for manual or unskilled work. Mrs Carroccio earned a low (X) in her job in the cafeteria of a local school shortly after she arrived in USA. 10. Training (13) - AnsThe provision of work-related education, either on-the-job or off-the-job. Mrs Carroccio, despite receiving a low wage in her job in the cafeteria of a local school, did receive (X). 11. Fringe benefits (13) - AnsThese are benefits received by employees in addition to their wages or salary e.g. free uniform, subsidised meals, health insurance and paid holidays (annual leave). In addition to Mrs Carroccio's wage from her job in the cafeteria of a local school, she also received health insurance as a fringe (X). 12. Profits (14) - AnsThe surplus left from revenue after production costs have been deducted. (X) from Mr Carroccio's shoe repair business (as well as Mrs Carroccio's wage) helped the family maintain an economically stable household in the early years of their move to the USA. 13. Earnings (21) - AnsMoney obtained from the provision of labour or services, such as wages, salaries, royalties and commission. At age 12, Alejandra's (X) from occasional jobs as a model, were put by her parents into a college fund for her. 14. Opportunities (26) - AnsThese are a set of circumstances in the external business environment that create a chance for further progress. At age 16, Alejandra's small part in the film La Bella Rosa, led to many new (X) for her. LadyA is faced with several business opportunities based on the suggestions from Kersey & Joyce. 15. Contract (27) - AnsTo enter into a legally binding agreement with specific terms between two or more persons or entities with a promise to do something in return. Being cast in the film 'La Bella Rosa', led to Alejandra being offered a (X) to produce a CD album by a music label. 16. Negotiation (28) - AnsDiscussions which take place between two parties in order to resolve an issue. Being only 16, Alejandra was not very familiar with the process of (X) when dealing with the music label offering her a contract, including financial compensation, to produce a CD album. 17. Agent (28) - AnsAn independent person or company appointed and authorised to act on behalf of another person in business and legal dealings. Gloria Woolrich, a local Hispanic who worked with Spanish-speaking performers, was appointed as an (X) by Alejandra. 18. Market (31) - AnsThe group of consumers interested in a product or a service, who are exiting or potential customers. Gloria believed that Alejandra should target the Spanish-speaking population in the USA. 19. Income (34) - AnsThe money that an individual receives in return for the work provided. Lady Alejandra received much (X) from the copyrights and royalties of her first CD album, Presentación Lady Alejandr