Compound interest is calculated on the amount plus the accrued interest. We use the following formula:

Credit life insurance guarantees the payment of an amount due on a loan should the insured person die before the loan has been repaid fully.

We use the current capital ratio to measure the short-term solvency of a business. It is the ratio of current assets to current liabilities and should not fall below 2:1.

Debentures are loans made available to companies, usually for a specified time period, at a specified interest rate.

Fidelity insurance protects the employer from dishonest deeds, such as fraud or embezzlement, committed by employees

In a fixed deposit, money is put into a savings account for a set period of time. If the money is drawn before maturity of the account, a penalty fee has to be paid.

Insurance is a contract whereby one party (the insurer) undertakes, in return for monthly payments, to indemnify another parted (the insured) for losses suffered as specified in the contract.

Liability insurance occurs in forms of ownership where the owners are faced with unlimited liability for the debts of the business.

Life assurance is a policy that will be paid to dependents after the death of the policy holder.

Liquidity analysis measures the ability of the business's current assets to cover its current liabilities.

Ordinary preference shares mean that the shareholders receive their dividend only if and when the business shows a profit.

Participating preference shares mean that shareholders may receive additional dividends after receiving their fixed dividend, but only after all other shareholders have received their dividends.

Business interruption insurance protects a business that has had to shut down as a result of a fire or other insured risks.

The quick acid test ratio measures the ability of a business to pay off its liabilities without selling stock. It should not fall below 1:1.

Redeemable debentures loans made available to companies that will be repaid after a certain time period.

Shares represent parts of a company. The shares are certificates issued to owners in a company as proof of their purchase.

Stokvels are groups of people that make their own decisions about how to save their money collectively.

A SWOT analysis analyses the internal strengths and weaknesses of the product and the business and the external opportunities and threats to the business.

A unit trust is a basket of the shares from different companies, and other financial instruments that are traded on the stock market.

Explain a contingency management approach.

What is the role of corporate reputation officer (CRO)?

Define democratic leadership.

What do we mean by an ethical business practice?

In a team, what is the Asch effect?

What does the term groupthink refer to?

Describe a laissez-faire leadership approach.

Autocratic leadership involves one person making decisions. This type of leadership is often used in businesses that lack discipline.

The school of human behaviour places the emphasis on creating a favourable environment between employer and employee and the external environment.

Social loafing occurs when the size of a group increases and the individual members of the team start to decrease their efforts.

A systems approach to management regards the business undertaking as a system in which individual departments combine to form an economic unit.

Theory Z is an approach to management that combines the best management techniques from American businesses and Japanese businesses.

The trait theory emphasises the qualities of good leaders, such as good physical and mental health, enthusiasm, unselfishness, courage, understanding of people and good communication skills.

Values are the social principles that help to create society's laws and a business's policies and procedures.

In agency shop agreements, the union subscriptions may be deducted on behalf of the majority trade union from the wages of non-members of the majority union without authorisation.

The letter of appointment should include the date on which the applicant will start work, the salary and fringe benefits, leave and conditions of service and termination.

Workplace forums are organisations that represent employees in the work place. These forums aim to reduce unilateral decision making by employers in matters affecting employees.

The Labour Appeal Court is the final court of appeal for all judgements and orders made by the Labour Court.

In closed shop agreements, all members covered by the agreement must be members of a trade union.

A collective agreement is a written agreement containing the terms and conditions of employment negotiated by the parties (the employer and trade unions) on behalf of the employees.

CCMA stands for Commission for Conciliation, Mediation and Arbitration. The CCMA is independent. It deals with disputes when an agreement cannot be reached between an employer and the trade union.

NQF stands for National Qualifications Framework. NQF is a framework for the provision of lifelong learning opportunities in accordance with nationally agreed qualification levels.

A trade union is a voluntary organisation established by employees with the purpose of protecting and improving their collective interests. Trade unions represent the interests of their members.

BEE stands for Black Economic Empowerment. This strategy aims to address human resource development, employment equity, ownership and control of enterprises, economic assets and preferential procurement and investment.

The macroenvironment of a business is the large environment outside the control and influence of the business environment, which includes demographic, political, social, educational and technological variables.

The microenvironment of a business is the small, internal environment of the business and its eight management functions.

The physical environment of a business consists of the resources, climate and location of a business.

Businesses or industries in the primary sector take or extract raw materials from nature. Businesses or industries in the secondary sector process raw or semi-finished materials into products for consumption.

SETA stands for Sector Education and Training Authorities. SETAs have been established to assume responsibility for the training of workers in specific industry sectors.

The Skills Development Act encourages lifelong learning and aims to facilitate the improvement of the general level of skills in our workforce.

Business organisations need to play a role to ensure that society runs effectively, by contributing to the welfare of their stakeholders as well as contributing to social welfare in general.