Business Key Terms Essay

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| The funds used by a business, coming either from its owner or from lenders such as banks. | | Where someone is employed on an on-going basis, rather than on a fixed contract, and usually only be dismissed as a result of breach of contract or redundancy. | | The amount of the money paid by customers in exchange for the goods or services produced by businesses. | | The surplus of revenue over cost is generated by a business over a period of time. | Added value | a process by which firms make their products more attractive to customers, so that they are prepared to pay a higher price. For example, a dry cleaner might offer a ‘free’ home delivery service to make it easier for customers to use. | Bank loan | a flexible form finance raised by borrowing from a bank. The amount borrowed is paid back with interest. The size and length of the loan depends on the needs of the business. | Brand name | A name, logo or symbol that is used by a business to support it brands and distinguish them from other market. Trademarks can be protected from copying or use by other businesses by registering them at the Patent Office. | Break even point | the level of output and sales where a firm’s total revenue exactly equals its total cost. It can be calculated by using the following formulafixed cost/contribution per unit | Breakeven chart | a graph that shows a firm’s total revenue, fixed costs and total costs over a ranges of output levels from zero output to the maximum capacity and the level of loss or profit made. This includes the point where the firm breaks even, i.e, where it is producing and selling enough to just cover it costs. | Business plan | written document providing key information about a business and its market. The main sections are the firm’s long term objective, its proposed marketing strategy, sources of finance, and cash flow forecasts and

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