Page 682 - Introduction to Business

G-8 GLOSSARY

first-line managers Managers who are directly responsible for heavily on foreign personnel for further production, mar-
supervising and working with employees and getting the keting, and human resources (Ch 17)
work done (Ch 5) franchising The practice in which a firm is obligated to
fiscal policy A government policy of using expenditures and provide specialized equipment and service support (e.g.,
taxation to guide the economy to meet economic goals training, product, price, promotion, and distribution
(related to output, employment, inflation, and the strategy), and at times even some seed money, in return
exchange rate); The use of government spending and tax- for an annual fee from the franchisee (Ch 2)
ation to stimulate or slow down the growth rate of the free market system The economic system in which consumers
economy (Ch 2; Ch 14) demand certain goods and services and are willing to pay a
fiscal year An accounting period of 12 months, which may or price based on their budget, and producers are willing to
may not end on December 31 (Ch 12) supply the goods and services on the basis of a price that
fixed exchange rate system The system in which a country will cover their costs and provide a profit margin (Ch 1)
pegs (fixes) its currency value (formally or de facto) at a free trade area An area in which two or more countries agree
fixed rate to a major currency or a basket of currencies to eliminate all barriers to trade such as tariffs, quotas, and
(Ch 2) nontariff barriers like border restrictions, while at the
fixed-income investment An investment in which an individ- same time they keep their own external tariffs (usually
ual invests an initial amount of money (principal), collects within WTO guidelines) against nonmembers (Ch 2)
interest on that initial amount, and receives back the ini- free trade regime A system in which imports and exports of
tial amount when the security matures (Ch 15) goods or services take place voluntarily, without govern-
fixed-position layout A layout where the product stays in one ment restrictions and based on a principle of free mar-
place, while the workers, materials, and equipment come kets (Ch 2)
to the product for manufacturing or service operations free-rein style An approach to management where employees
(Ch 16) are given complete freedom to perform their jobs the way
flexible, or cafeteria, benefit plans Plans giving employees they want within company rules and objectives (Ch 7)
considerable choice in picking the benefits they want freight forwarder Agents that perform a wide variety of ser-
(Ch 6) vices for companies shipping products to international
flextime The flexible daily work hours chosen by employees in customers (Ch 10)
consultation with their supervisors in addition to core functional departmentalization Departmentalization based
time, the daily period during which all employees are on the functions performed by that unit (Ch 5)
expected to be at work to facilitate interactive communi- functional organizational structure The structure of an
cation and workflow (Ch 7) organization around certain functions such as marketing,
floating exchange rate system The system in which currency finance, and so on (Ch 5)
values are determined by the demand for and supply of funded pension plan A pension plan that pays retirees from
currencies in a foreign exchange market (Ch 2) their funds set aside in a savings plan in during their work-
focus group A small group of consumers that is representative ing years (Ch 14)
of the market for a new product and provides companies future value The value of a dollar in the future, which is less
with reactions to new product concepts (Ch 9) than its value today (Ch 13)
forced distribution methods Performance appraisals requir-
ing a defined ranking of performance into different gainsharing plans Plans for sharing company productivity
levels (Ch 6) gains or savings with the responsible work group (Ch 6)
Foreign Corrupt Practices Act The federal law prohibiting gap risk The sensitivity of a financial institution’s profitability
U.S. companies doing business overseas from making due to changes in interest changes (Ch 14)
payments to foreign officials to influence their discre- general managers Managers who coordinate and supervise
tionary decisions (Ch 3) more-specialized managers (Ch 5)
foreign direct investment (FDI) An overseas investment in general partners Partners who run the partnership’s business
plant and equipment to produce goods or services for and who are liable for its actions (Ch 3)
local consumption or for exports (Ch 2) general-purpose software The set of software programs that
foreign exchange markets Financial centers where a network of perform common information processing jobs, such as
international banks and currency traders (people who buy, word processing, for end users (Ch 17)
sell, or speculate on currencies) transact business (Ch 2) generally accepted accounting principles (GAAP) The princi-
forward vertical integration A form of vertical integration ples by which financial statements are prepared (Ch 11)
where the supply chain member that develops the ability generic brands Products that do not have a brand name, but
to perform the function that another supply chain contain only an indication of their contents on the pack-
member has been performing is “upstream’’ from that age (Ch 9)
supply chain member (Ch 18) geographic departmentalization Departmentalization based
fourth-generation languages Programming languages that on the geographic areas or locations served by the organi-
are less procedural than earlier programming languages zation (Ch 5)
and are very close to human languages (Ch 17) gigabyte One billion bytes (Ch 17)
franchise An authorization by a corporation to individuals globalization The process of integrating the market for goods
that allows them to participate as an owner-manager of a and services worldwide; The process of eliminating trade,
branch entity of the corporate firm (Ch 4) investment, cultural, and even political barriers across
franchiser An organizational structure where a product is cre- countries, which in turn could lead to freer movement of
ated, designed, financed, and initially produced in the goods, services, labor, capital, technology, and companies
home country, but for product-specific reasons, relies across international borders (Ch 1; Ch 2)

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