Studied by 48 people
MNC (multinational corporation)
a company that operates in its home country, as well as in other countries around the world
global supply chain
the process of organising all the steps needed to make and deliver products to customers across different countries. can include inputs and phases of development, production and distribution.
business
any organisation that produces and sells for profit, the goods and services satisfy our needs and wants.
profit
what money remains after all business expenses are deducted from sales revenue.
sole trader
a business owned and operated by one person
private company
a business owned that usually has between 2-50 private owners called shareholders.
public company
a business that has an unlimited number of shareholders traded on a stock exchange
term deposit
when you lock away an amount of money for the term (an agreed length of time) and you can’t access the money until the term is up. in return for locking it away, you receive a fixed amount of interest for the term selected.
superannuation
money set aside during your working life for when you retire
describe the relationship of the risk reward model
the higher the risk of your growth assets, the higher the return of your money, but higher the potential loss
explain the concept of compound interest
when you earn interest on both your initial money and the interest you've already earned
benefits of savings account
can access your funds any time
earns interest
savings account drawbacks
accounts must have a minimum balance
low return: lower interest rates
term deposit benefits
no service/startup fees
protected from slumps in the market
term deposit drawbacks
money isn’t accessible
won’t benefit from rises in the market
asx sharemarket benefits
liquidity (ease of converting an asset into cash)
cost-effective
asx sharemarket drawbacks
share prices can rise and fall rapidly
emotional investing
describe a risk profile
the level of risk an individual is prepared and able to accept in their financial circumstances
phishing emails
trick you into giving computer access
encourages you to click on a link/attachment that is posed as from an organisation you trust
if you click, malicious software is installed and the hacker has access to personal info and files.
romance scams
scammers create fake dating profiles on dating websites
try to enter a relationship w/ you to get your personal info and money
often ask for money for health-related/family “issues”
exploit your emotions
mnc positives
investment = economic growth
less developed countries: jobs created, standard of living increases
stimulate other businesses in the area
mnc negatives
profits returned to home country rather than host country
often exploit developing countries by paying low wages
often have poor environmental conditions in host country
competitive advantage
when a business can produce and sell goods/services better than its competitors
why seek a competitive advantage?
consistently succeed in the industry
increase number of customers
remain unique in an ever-competing industry
how to get competitive advantage?
offer better price
make consumer aware of product/service (social media)
offer consumer better quality/perceived quality
improve brand reputation: show corporate social responsibility
be more responsive to consumer needs
tesla’s innovations
affordable electric cars
self-driving cars
supercharging stations
battery technology breakthroughs
batteries to use in household
ability to shop online
Note
Flashcard