Capacity

The maximum output that a firm can produce in a given period of time.

Capacity Utilisation

A measure of how much of a firm's capacity is being used.

Capital

Money that has been invested in a business.  It can take the form of machinery as well as money.

Cash and Carry

A type of wholesaler, that does not offer delivery or credit.

Cash Cow

A product or brand that has a high share of a declining market, as identified by the Boston Matrix.

Cash Flow Forecast

A statement which estimates what money will be coming into the business and what money will be going out of the business over a future period of time.

Cell Production

A method of production that splits workers into small groups or "cells", with each group being responsible for their own work.

Central Bank

An institution that is responsible for a country's monetary system, e.g. the Bank of England, or the Federal Reserve in the USA.

Centralised Organisation

One where most of the important decisions are made by the top of the hierarchy in a business.

Ceteris Paribus

Latin phrase used commonly within economic theory that means "other things being equal".

Chain of Command

The path that decisions and orders will pass through from the top of a hierarchy to the bottom.

Chain of Production

The stages which a product goes through from raw materials to the finished product.  Usually this will involve the primary, secondary and tertiary sectors.

Chamber of Commerce

Local voluntary organisations who will give help and advice to businesses.

Channel of Distribution

The stages a product goes through in order to reach the end consumer, perhaps involving a wholesaler or a retailer.

Charity

A type of business organisation that is not set up to make a profit, but instead aims to raise funds for a good cause.

Circular Flow of Income

A macroeconomic concept that outlines how different sectors of the economy are linked, and how money will flow around it.

Closed Question

A type of question used in a questionnaire that only allows a limited number of answers.

Cluster Sample

A method of selecting people for use in market research activity based upon a small area belived to represent the target audience.

Collateral

Security that banks may demand as a guarantee for a loan.  It usually takes the form of property.

Collective Bargaining

When the unions rather than individual employees negotiate with management over pay and conditions.

Communication

The method by which information is passed between people.  It may be visual, written or oral.

Companies House

Where records of all companies in the UK are kept.

Competition Commission

An organisation that tries to ensure a business does not get too powerful. It will investigate mergers of firms to see if they are against the public interest. It can make recommendations to the Government who can decide to stop mergers or break up monopolies.

Competitive Pricing

Setting a price for a product or service based upon the price charged for similar goods and services by competitors.

Complementary Goods

Goods that complement each other, such as fish and chips.

Components

Parts of a product.

Computer Aided Design (CAD)

C.A.D. makes it possible to design products on a computer, which can be seen from all angles (3D). It avoids having to build expensive models and so saves time and money.

Computer Aided Manufacture (CAM)

C.A.M. is where computers are used to help in the production process e.g. control drilling machines, so holes are drilled to the exact depth.

Computer Integrated Manufacture (CIM)

C.I.M. is where computers are used in most parts of the production to control machines which are carrying out a number of different functions.

Conciliation

Attempting to talk to both unions and employers to come to an agreement over a dispute, before attitudes harden.

Confederation British Industry (CBI)

This group represents the views of businesses to trade unions and the Government.

Conglomerate

An organisation that is made up of a number of disconnected businesses, often brought together by mergers.

Constructive Dismissal

Where an employee's employment is ended because they have acted unlawfully, or broken their contract of employment.

Consumable

A product that is not designed to last - but to be used up.  For example, a packet of crisps.

Consumer

Someone who consumes a product.  Not necessary the purchaser or customer.

Contribution

The difference between the selling price of an item, and it's variable cost.  This then makes a "contribution" towards the fixed costs incurred.

Co-operatives

A type of business organisation that is owned by it's members.  The members also share the profits.  Best known as the supermarket chain.

Copyright

Legal protection against the copying of others work.

Corporation Tax

A tax which the Government charges to companies on their profits, once they reach a certain level.

Cost-based Pricing

Setting a price based upon how much it costs to produce.

Cost-benefit Analysis

A comparison of all of the social costs and social benefits of an activity.

Cost-plus Pricing

Where the price of a product is determined by adding a percentage profit onto the costs incurred in making it.

Cost-push Inflation

A general and sustained rise in prices caused by increases in the costs incurred by firms.  This might be caused by increases in wage levels for example.

Craft Union

A trade union that represents the interest of a group of highly skilled workers.

Credit

The ability to acquire goods immediately, but pay for them at a later date.

Creditors

People or firms to whom a business owes money

Current Asset

Something owned by a business that it does not expect to keep for more than 12 months.

Current Liability

A debt that a business has not yet paid, but expect to pay within the next 12 months.

Customer

The purchaser of a product or service.

CV

Curriculum Vitae.  A summary of a person's career and experience that can be used in the recruitment process.

Cyclical Unemployment

Where jobs are lost because the economy has entered a downturn in the business cycle.