Business & Finance Fundamentals Flashcards

What does 'accounts receivable' represent for a business?

Answer: Money owed to the business by its customers

Accounts receivable represents money that customers owe to the business for goods or services already delivered.

Which economic principle states that as price increases, consumer demand typically decreases?

Answer: Law of Demand

The Law of Demand states that as the price of a good rises, consumers tend to purchase less of it, all else being equal.

In business, what is a 'budget'?

Answer: A financial plan estimating future income and expenses

A budget is a financial plan that estimates projected income and expenses over a specific period to guide spending decisions.

What is the primary role of a credit score in personal finance?

Answer: To measure a person's creditworthiness for lenders

A credit score numerically represents a person's creditworthiness, helping lenders assess the risk of lending money.

Which term describes total business expenses exceeding total revenues?

Answer: Loss

A loss occurs when a business's total expenses exceed its total revenues during a given period.

In marketing, what is a 'target market'?

Answer: The specific group of consumers a business aims to reach

A target market is the specific group of consumers most likely to purchase a product or service, defined by demographics, interests, or needs.