Edexcel Economics 6. Business Behaviour

Description

Term

A merger between firms or acquisition of one firm by another that is operating in a different market

The which often arises where conflicts of interest arise between stakeholders

Internal economies of scale resulting from large firms being able to obtain finance more cheaply and easily due to their creditworthiness

That which firms may be seeking to influence by growing and increasing their market share

That which an industry achieves when all firms are earning normal profit, with none making losses as they would exit the market, and none earning supernormal profit as this would incentivise new firms to enter the market

Those that growth, irrespective of profits, might benefit by granting them higher pay, status, and power

An organisation or corporation owned and funded by the government such as the Bank of England or a public sector hospital

The which firms might not do so as to; avoid regulatory burdens, minimise overhead costs, maintain flexibility, adaptability, and the close relationship with consumers, maintain quality control, or due to the owner's lifestyle choice

A company with statutory minimum capital, the shares of which are publicly tradable subject to limited liability

Those, the growth of which is measured in terms of; output, sales revenue, market share, asset value, and/or workforce size

Description

Term

The cost per unit of output feasible when all factors of production are variable

Internal economies of scale resulting from large firms being able to use more specialised staff and invest in making production more efficient

The period of time in which the scale of a firms operations - though not variable factors like the number of people employed (assuming spare capacity) - cannot be changed

That which a firm makes when average revenue exceeds average cost

That which often arises where firms within a particular industry are concentrated within one geographic area such as horse racing in Newmarket, Suffolk

A process by which firms expand from within as done by Marks and Spencer, being controlled and avoiding excess capacity, but also slow

That which a firm achieves when it is producing that output which allows it to maximise profits, i.e. MR=MC

That which often arises from inefficiencies and complexities in managing and administering large firms, such as due to a result of the principal-agent problem

That which - if not sub-contractors - many small firms often act as to larger firms

That, some of the principal disadvantages of which are that; firms cannot compete so well with larger ones, cannot take advantage of certain economies of scale, and that it can be confusing for customers