Definition List Part 3
CAMBRIDGE O LEVEL COMMERCE (7100)
COMPLETE DEFINITIONS NOTES — PART 3
BANKING
Bank
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A financial institution that accepts deposits and provides financial services.
Main Functions:
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Accepting deposits
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Giving loans
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Facilitating payments
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Safekeeping valuables
Commercial Bank
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A bank providing services to businesses and individuals.
Services Provided:
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Loans
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Current accounts
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Savings accounts
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Foreign exchange
Central Bank
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The bank responsible for controlling a country’s monetary system.
Functions:
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Issuing currency
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Controlling money supply
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Banker to government
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Supervising commercial banks
Deposit
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Money placed into a bank account.
Withdrawal
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Taking money out of a bank account.
Savings Account
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A bank account designed for saving money.
Features:
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Earns interest
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Limited withdrawals
Current Account
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A bank account mainly used by businesses for frequent transactions.
Features:
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Cheque facilities
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Overdraft available
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Usually no interest
Fixed Deposit Account
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Account where money is deposited for a fixed period to earn higher interest.
Loan
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Borrowed money that must be repaid with interest.
Interest
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The cost of borrowing money or reward for saving money.
Overdraft
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Permission to withdraw more money than available in an account.
Written and Compiled By Sir Hunain Zia (AYLOTI), World Record Holder With 154 Total A Grades, 11 World Records and 7 Distinctions, Educate A Change.
Standing Order
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Instruction to a bank to make regular fixed payments automatically.
Direct Debit
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Permission given to an organisation to collect varying payments automatically.
Cheque
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Written order instructing a bank to pay money.
Bearer Cheque
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Cheque payable to whoever presents it.
Crossed Cheque
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Cheque that must be deposited into a bank account.
Dishonoured Cheque
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Cheque refused by the bank.
Reasons:
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Insufficient funds
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Signature mismatch
Debit Card
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Card allowing payment directly from a bank account.
Credit Card
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Card allowing purchases on credit.
ATM (Automated Teller Machine)
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Machine allowing customers to perform banking transactions.
Online Banking
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Banking services conducted through the internet.
Mobile Banking
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Banking services conducted using mobile devices.
E-Banking
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Electronic banking services.
Bank Statement
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Record of transactions in a bank account.
Credit Transfer
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Electronic transfer of money from one account to another.
Safe Custody
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Bank service keeping valuables secure.
Currency
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Money used in a country.
Foreign Exchange
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Buying and selling foreign currencies.
Exchange Rate
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Price of one currency in terms of another currency.
Traveller’s Cheque
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Prepaid cheque used by travellers.
Letter of Credit
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Bank guarantee ensuring payment to exporters.
Bank Draft
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Guaranteed payment document issued by a bank.
Mortgage
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Long-term loan used to purchase property.
Collateral
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Asset pledged as security for a loan.
Liquidity
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Ability to access cash quickly.
Written and Compiled By Sir Hunain Zia (AYLOTI), World Record Holder With 154 Total A Grades, 11 World Records and 7 Distinctions, Educate A Change.
ADVERTISING
Advertising
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Paid communication used to inform or persuade consumers.
Objectives:
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Increase sales
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Create awareness
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Build brand image
Informative Advertising
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Advertising intended to provide information.
Persuasive Advertising
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Advertising intended to convince consumers to buy products.
Competitive Advertising
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Advertising used to compete with rival businesses.
Institutional Advertising
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Advertising promoting the image of a business rather than a product.
Target Market
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Specific group of consumers a business aims to sell to.
Brand
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Name, symbol or design identifying a product.
Branding
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Creating a unique identity for a product.
Trademark
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Legally registered symbol or brand name.
Slogan
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Short memorable phrase used in advertising.
Logo
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Symbol representing a business or brand.
Advertising Agency
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Business specialising in creating advertisements.
Media
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Methods used to communicate advertisements.
Examples:
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Television
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Radio
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Newspapers
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Internet
Press Advertising
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Advertising through newspapers and magazines.
Broadcast Advertising
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Advertising through television and radio.
Outdoor Advertising
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Advertising displayed outdoors.
Examples:
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Billboards
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Posters
Direct Advertising
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Advertising sent directly to consumers.
Examples:
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Emails
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Leaflets
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SMS marketing
Point of Sale Advertising
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Advertising displayed where purchases are made.
Neon Sign
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Electrically illuminated advertising sign.
Written and Compiled By Sir Hunain Zia (AYLOTI), World Record Holder With 154 Total A Grades, 11 World Records and 7 Distinctions, Educate A Change.
Window Display
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Arrangement of goods in shop windows to attract customers.
Packaging
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Covering or container used for products.
Functions:
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Protection
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Promotion
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Information
Sales Promotion
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Short-term activities encouraging sales.
Examples:
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Discounts
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Coupons
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Competitions
Publicity
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Unpaid media attention gained by a business.
Public Relations
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Activities aimed at maintaining a positive image of a business.
Market Research
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Collecting and analysing information about consumers and markets.
Questionnaire
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Set of written questions used for surveys.
Consumer Behaviour
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The way consumers make buying decisions.
Impulse Buying
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Buying without prior planning.
Product Life Cycle
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Stages through which a product passes from launch to decline.
Stages:
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Introduction
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Growth
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Maturity
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Decline
Market Segmentation
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Dividing consumers into groups with similar characteristics.
E-Commerce
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Buying and selling goods through electronic systems.
Mail Order
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Buying goods through catalogues or online without visiting shops.
Telemarketing
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Marketing products through telephone calls.
Influencer Marketing
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Promotion using influential individuals on social media.