Business Dynamics Midterm

Terms that I WILL NOT confuse

mission

why we exist as a business; fundamental purposes of the organization

vision

where we want to go/what we want to accomplish

absolute advantage

ability to produce more goods or services using the same amount of resources

comparative advantage

the ability to produce goods and services at a lower cost

S corp

government creation that looks like a corporation but is taxed like sole proprietorships and partnerships

LLC

similar to S corp, but without the special eligibility requirements

dumping

selling products in a foreign country more cheaply than we do here

assembly line layout

base level of product and more is added on at each stage of the line; workers doing a few tasks at a time

modular layout

teams of workers producing complex units of the final product (engines, tires, etc all coming from diff places)

fixed position layout

when the product is too big to move so you bring the equipment and labor to it

process layout

similar equipment and functions grouped together

vertical merger

joins two firms operating in different stages of related businesses

horizontal merger

joins 2 firms in the same industry and allows them to diversify or expand their products

PERT chart

monitors progress of production; compute minimum time needed to complete the whole project

GANTT chart

bar graph that shows what projects are being worked on and how much has been completed at any given time

Sarbanes Oxley

2002; increased the consequences for destroying, altering, or fabricating financial records and for trying to defraud shareholders

Dodd Frank

series of legislation regulating Wall Street around the same time as Sarbanes Oxley

insider trading

using private company info to further insiders’ own fortunes

balance of trade

total value of a nation’s exports compared to its imports

balance of payments

difference between money coming in from exports and money leaving the country for imports plus money flows coming into or leaving a country from other factors such as tourism, foreign aid and investment, military expenditures, etc.

PMI

pluses, minuses, and implications; decision making technique

external customers

dealers and ultimate customers (end users)

internal customers

individuals and units within the firm that receive services from other individuals or units

contract manufacturing

foreign company produces private-label goods to which a domestic company then attaches its own brand name or trademark

statistical quality control

process some managers use to continually monitor all phases of the production process and ensure quality is being built into the product from the beginning

statistical process control

process of testing statistical samples of product components at each stage of production and plotting the test results on a graph