MBA Glossary Template (330+ Terms by Course Area)

MBA glossary: 330+ plain-language definitions in 16 areas from admissions to recruiting, linked cards, dated test and standards facts, study routine

MBA 및 경영대학원전체GMAT Focus, GRE, TOEFL iBT 2026 scale; IFRS 18; Directive (EU) 2026/470; IFRS S1 and S2glossary업데이트됨 2026. 10. 28.

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사용법: Use it when a term in a case, lecture, application or interview is unclear, or to build flashcards before term. Triage each area first (known, familiar, new) and card only the gaps. The main pitfall is re-reading definitions instead of testing yourself with spaced, mixed reviews.

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MBA Glossary: [Your programme, cohort or study group]

A reference glossary of more than 330 terms an MBA student meets between the first admissions search and the first post-MBA job, grouped into 16 areas: admissions and tests, programme life, financial and managerial accounting, corporate finance and valuation, economics, statistics and analytics, marketing, operations, strategy, organisational behaviour and leadership, negotiation, ethics and ESG, entrepreneurship and venture finance, AI for managers, and recruiting for consulting, banking, private equity and product roles. Each entry gives a short plain-language definition written for this library and the mba/* card or guide that teaches the idea in depth. It is for applicants, admitted students before day one, students in the core year and graduates who want a single page to check a word quickly. Source basis: the original works named in the entries, the official pages of GMAC, ETS, the IFRS Foundation, AACSB, EFMD, AMBA and EUR-Lex (checked October 2026), and learning research on retrieval practice, spacing and interleaving (Dunlosky et al. 2013). Replace every [bracketed] value and every row marked Example. This is a study aid, not admissions, legal, tax or financial advice: facts that change (test formats, loan rules, visas, reporting standards) are dated, so check the linked official page before you rely on them.

Document control

Field	Value
Document ID	[MBA-GLOS-001]
Version	[0.1]
Status	[Draft / In use]
Owner	[Your name]
Programme and cohort	[Programme name, class of YYYY]
Reviewed by	[Mentor, coach or study-group lead]
Last updated	YYYY-MM-DD
Dated facts last re-checked	[YYYY-MM-DD, against the official pages in "Sources and further reading"]
Classification	[Personal study material]

How to use this glossary

A glossary helps most when you use it to test yourself, not when you read it. Re-reading gives a feeling of familiarity that is easy to mistake for knowledge. The study techniques with the strongest evidence in the review by Dunlosky and colleagues (2013) are practice testing (retrieving an answer from memory) and distributed practice (spreading the reviews of the same material over days and weeks). Interleaving, which means mixing different kinds of items in one session instead of practising one kind in a block, has also been shown to improve the ability to pick the right method for a problem (Rohrer and Taylor 2007). The routine below puts the three together.

Step 1: Triage (once per area, 10 minutes). Before a course starts, read the area's table and mark each term with one of three codes in your own copy: K (I could explain it to a classmate now), F (familiar but I could not define it precisely), N (new). Only F and N terms go forward.

Step 2: Make cards (5 minutes per session). For each F or N term, write a flashcard in mba/mba-concept-flashcards or academic/stats-flashcards-spaced-review. The front holds the term and a cue ("what does it measure, and what is it compared with?"). The back holds your own one-sentence definition, written without looking at this page, then corrected against it. Writing it yourself first is a retrieval attempt and is part of the learning.

Step 3: Interleave (every session). Draw cards from at least three areas in each session, for example ten accounting cards, ten strategy cards and ten statistics cards, shuffled together. Mixing forces you to recognise which idea a cue belongs to, which is exactly what a cold call or a case interview asks of you.

Step 4: Space the reviews. Review a new card one day, three days, seven days, fourteen days and about thirty days after you first learn it. Each time you miss it, move it back to the one-day box. Example: a term first studied on Monday 2026-11-02 comes back on 2026-11-03, 2026-11-05, 2026-11-09, 2026-11-16 and 2026-12-02.

Step 5: Use it in a sentence (weekly, 10 minutes). Pick five terms you got right this week and use each in one sentence about a case you are reading. Using a term in context (elaborative interrogation and self-explanation, both rated as moderately useful by Dunlosky and colleagues) links it to the problems where it matters.

Step 6: Log errors. When you misuse a term in class, in an exam or in an interview, record it in mba/mba-error-log with the correct meaning and the card that fixes it.

Week of term	Areas to triage	Cards to add	Mixed sessions	Example note
Pre-term (Example)	1, 2, 3, 6	30	3	Accounting F terms: accrual, deferred revenue, working capital
Week 1 (Example)	4, 5, 7	25	3	Mixed accounting, finance and statistics cards
Week 2 (Example)	8, 9, 10	25	3	Strategy terms used in case discussion
[Week]	[Areas]	[Number]	[Number]	[Note]

Entry conventions

Term. The common name, with the abbreviation in brackets. Where British and American spellings differ, the library uses British spelling in prose ("programme", "organisational").
Definition. One or two sentences in plain language, written for this library. Definitions explain what a term means and how managers use it; formulas and worked examples are in the linked cards.
Originator and year. Frameworks and models carry the author and year of the original work, so you can cite them correctly in an essay or a case write-up.
Learn it in. The mba/* card, guide or tool that teaches the term. Where the statistics library already has a fuller card, an academic/stats-* slug is added.
Dated facts. Anything defined by a test owner, a standard setter or a government is marked "as of October 2026" with the owner named. Check the official page listed in "Sources and further reading" before you rely on it.
Illustrative numbers. The few numbers in definitions are fictional and were computed for this page; the Excel formula is shown so you can reproduce them.

1. Admissions and tests

Term	Definition	Learn it in
Accreditation (AACSB, EQUIS, AMBA)	External quality review of a business school or programme. AACSB and EFMD's EQUIS accredit institutions, AMBA accredits individual programmes; schools holding all three are often called "triple accredited".	mba/mba-program-comparison
AACSB Global Standards for Business Education	AACSB's standards ratified by its members on 20 April 2026, replacing the 2020 standards and organised around strategic management, learner success and pathways to impact (as of October 2026, check aacsb.edu).	mba/mba-program-comparison
Admissions round	One of the fixed application windows in a school's cycle, typically Round 1 in September, Round 2 in January and Round 3 in spring. Dates change every year, so take them from the school's page.	mba/mba-application-tracker
Application fee waiver	A school's agreement to waive its application fee, often for military service, financial need or event attendance. Criteria are school-specific.	mba/mba-funding-scholarship-plan
Class profile	A school's published summary of the entering class: size, test score ranges, undergraduate grades, work experience, nationality and industry mix. Medians and ranges describe the class, they are not cut-offs.	mba/mba-school-list-strategy
Consortium and fellowship programmes	Organisations or school schemes that review applications and award funding to candidates who meet a mission, such as broadening access to management. Eligibility rules are set by each organisation.	mba/mba-funding-scholarship-plan
Deferred admission	A programme that admits college seniors or early-career graduates now and asks them to work for a set period before enrolling.	mba/mba-deferred-admission-plan
Deposit	A non-refundable payment that secures a seat after an admit. Deadlines are short, so plan the cash before decision day.	mba/mba-admit-decision
Executive Assessment (EA)	GMAC's test designed for executive and experienced-professional programmes: as of October 2026 about 90 minutes, three sections (Integrated Reasoning, Verbal, Quantitative), total score 100 to 200. Check gmac.com for the current format.	mba/mba-admissions-test-plan
Executive MBA (EMBA)	An MBA for experienced managers taught while they keep working, usually on weekends or in modules, often with employer sponsorship.	mba/emba-sponsorship-proposal
GMAT Focus Edition	GMAC's graduate management test, the only GMAT version offered as of October 2026: Quantitative Reasoning, Verbal Reasoning and Data Insights, 45 minutes each, 64 questions, section scores 60 to 90 and a total of 205 to 805, with no essay. Check mba.com.	mba/mba-admissions-test-plan
Data Insights (GMAT)	The GMAT Focus section that tests reading tables, graphs and multi-source data and judging whether data are sufficient; an on-screen calculator is available in this section only (as of October 2026).	mba/mba-admissions-test-plan
GRE General Test	ETS's graduate test accepted by most MBA programmes: since September 2023 about 1 hour 58 minutes, with one Analyze an Issue essay and two Verbal and two Quantitative sections; Verbal and Quantitative are scored 130 to 170 and writing 0 to 6 (as of October 2026, check ets.org).	mba/mba-admissions-test-plan
Computer-adaptive testing	A test design in which the difficulty of the next question or section depends on your answers so far. GMAT Focus adapts by question; the GRE adapts its second Verbal and Quant section to performance on the first.	mba/mba-admissions-test-plan
Score validity	The period a test owner keeps a score reportable: five years for GMAT and GRE and two years for TOEFL and IELTS, as published in October 2026.	mba/mba-admissions-test-plan
TOEFL iBT	ETS's English test. From 21 January 2026 it reports a 1 to 6 band score in half-band steps aligned with the CEFR, plus a comparable 0 to 120 score during a two-year transition (as of October 2026, check ets.org).	mba/mba-english-test-plan
IELTS Academic	An English test reported in bands from 0 to 9 in half-band steps for Listening, Reading, Writing and Speaking, plus an overall band.	mba/mba-english-test-plan
CEFR	Common European Framework of Reference for Languages: six levels from A1 to C2 that test owners map their scores to. Many programmes ask for about C1.	mba/mba-english-test-plan
English waiver	A school's decision not to require an English test, usually because of a prior degree taught in English. Each school sets its own rule.	mba/mba-international-applicant-plan
Recommender	A supervisor or colleague who writes a letter or answers a school's questions about you. A short brief with evidence helps them be specific.	mba/mba-recommender-brief
Optional essay	A short additional statement used to explain a gap, a low score or another part of the file that needs context, not a second goals essay.	mba/mba-optional-essay
Reapplicant	Someone applying again to a school that declined them in an earlier cycle; many schools ask what has changed.	mba/mba-reapplicant-essay
Video essay	A timed recorded answer to a question shown on screen, used by some schools in place of or beside a written essay.	mba/mba-video-essay-prep
Team-Based Discussion	A group exercise in which several applicants solve a short business prompt together while observers assess collaboration; Wharton is a school that has used this format, check the school's current instructions.	mba/mba-team-discussion-prep
Blind interview	An admissions interview in which the interviewer has read only the résumé or nothing at all from the file.	mba/mba-interview-prep
Waitlist	A decision that neither admits nor declines; the school may admit from the list later. Follow each school's rules on updates.	mba/mba-waitlist-update-letter
AI-use policy (applications)	A school's rules on whether and how applicants may use generative AI in essays and short answers. Policies differ between schools and change, so check each application and disclose when asked.	mba/mba-ai-use-policy-check
Grad PLUS and federal graduate loans (US)	As of October 2026, US federal Grad PLUS loans are closed to new borrowers from 1 July 2026, and new graduate borrowers in programmes such as the MBA face limits on Direct Unsubsidized loans of USD 20,500 a year and USD 100,000 in total, within a USD 257,500 lifetime limit, with a legacy rule for students enrolled before that date. Check studentaid.gov before you rely on it.	mba/mba-funding-scholarship-plan
Return on an MBA	The comparison of the full cost (tuition, living costs and forgone salary) with the expected change in lifetime earnings and options, usually as an NPV or payback period.	mba/mba-decision-roi

2. Programme and academic life

Term	Definition	Learn it in
Core curriculum	The required first-year courses (accounting, finance, economics, statistics, marketing, operations, strategy, leadership) that give every student a shared toolkit.	mba/mba-core-curriculum-map
Elective	A course chosen by the student, usually in the second year, often grouped into a concentration or major.	mba/mba-elective-concentration-plan
Concentration or major	A declared set of electives in one field, such as finance or entrepreneurship. Some programmes have STEM-designated tracks.	mba/mba-elective-concentration-plan
Case method	Teaching by discussion of a written business situation: students prepare individually, discuss in a learning team, then argue a position in class led by the instructor.	mba/mba-case-reading-guide
Case	A written description of a real or disguised business situation, with exhibits, that ends with a decision a manager has to make.	mba/mba-case-prep-sheet
Cold call	The instructor's practice of asking a student, without warning, to open a case discussion. Preparation of the key decision and numbers is the only defence.	mba/mba-case-prep-sheet
Class participation	The share of the grade based on the quality of a student's contributions to discussion, often 25 to 50 percent of a case course grade.	mba/mba-class-participation-log
Learning team (study group)	A small assigned group, often diverse by background, that prepares cases and submits group work together.	mba/mba-learning-team-charter
Team charter	A written agreement on a team's goals, roles, norms, meeting rhythm and how it resolves conflict.	mba/mba-learning-team-charter
Peer feedback	Structured comments team members give each other on behaviour and contribution, usually with a model such as Situation-Behaviour-Impact.	mba/mba-peer-feedback
Grade non-disclosure	A policy, at some schools, under which students agree not to share grades with employers. Rules differ by school.	mba/mba-exam-prep
Forced curve	A grading rule that caps the share of students who may receive each grade in a section.	mba/mba-exam-prep
Field project (experiential learning)	A team project for a real client, with a scope of work, interim reviews and a final report.	mba/mba-field-project-sow
Global immersion	A short course abroad in which students study a region's economy and meet firms.	mba/mba-global-immersion-plan
Exchange semester	A term spent at a partner school, credited towards the home degree.	mba/mba-exchange-semester-plan
Capstone	An end-of-programme integrative project, simulation or course that draws on several disciplines.	mba/mba-capstone-project-report
Case competition	A timed contest in which teams analyse a case and present recommendations to judges.	mba/mba-case-competition-prep
Pre-MBA preparation	The work admitted students do before term, such as quantitative, accounting and Excel refreshers, often with a school waiver exam.	mba/pre-mba-roadmap-12-weeks
Waiver exam	A test that lets a student skip a core course they already know, freeing a slot for an elective.	mba/pre-mba-roadmap-12-weeks
Learning journal	A regular written reflection on what was learned, what was tried and what to change next (after Kolb 1984 and Schön 1983).	mba/mba-learning-journal

3. Financial accounting

Term	Definition	Learn it in
Accrual accounting	Recording revenue when it is earned and expenses when they are incurred, whatever the timing of cash.	mba/mba-three-statements-card
Balance sheet (statement of financial position)	A snapshot of what a company owns (assets), what it owes (liabilities) and the owners' residual claim (equity) at one date.	mba/mba-three-statements-card
Income statement (statement of profit or loss)	The report of revenue, expenses and profit over a period.	mba/mba-three-statements-card
Cash flow statement	The report of cash in and out over a period, split into operating, investing and financing activities.	mba/mba-cash-flow-statement-card
Accounting equation	Assets equal liabilities plus equity; every transaction keeps both sides equal.	mba/pre-mba-accounting-primer
Double entry	The bookkeeping rule that every transaction has at least one debit and one credit of equal amount.	mba/pre-mba-accounting-primer
Revenue recognition	The rules for when and how much revenue to record: under IFRS 15 and ASC 606, when control of a promised good or service passes to the customer.	mba/mba-three-statements-card
Deferred revenue	Cash received before the company has delivered the good or service; it is a liability until earned.	mba/mba-three-statements-card
Accounts receivable	Amounts customers owe for goods or services already delivered on credit.	mba/mba-ratio-analysis-card
Inventory and cost of goods sold	Goods held for sale, and the cost of the goods that were sold in the period, which moves from the balance sheet to the income statement.	mba/mba-three-statements-card
Depreciation and amortisation	Spreading the cost of a long-lived tangible asset (depreciation) or intangible asset (amortisation) over its useful life.	mba/mba-three-statements-card
Impairment	A write-down when an asset's carrying amount exceeds what can be recovered from it.	mba/mba-financial-accounting-guide
Goodwill	The amount paid in an acquisition above the fair value of the net identifiable assets acquired; tested for impairment rather than amortised under IFRS and US GAAP for public companies.	mba/mba-financial-accounting-guide
Working capital	Current assets minus current liabilities; in analysis, often operating working capital (receivables plus inventory minus payables).	mba/mba-ratio-analysis-card
Retained earnings	The cumulative profits a company has kept rather than paid out as dividends.	mba/mba-three-statements-card
Lease liability and right-of-use asset	Under IFRS 16, a lessee records most leases on the balance sheet as an asset for the right to use the item and a liability for the payments.	mba/mba-financial-accounting-guide
EBITDA	Earnings before interest, taxes, depreciation and amortisation, a non-GAAP proxy for operating cash generation. Definitions vary, so read the reconciliation.	mba/mba-ratio-analysis-card
Operating profit (IFRS 18)	A subtotal that IFRS 18 requires: income and expenses in the operating category. As of October 2026 IFRS 18 applies to annual periods beginning on or after 1 January 2027 and replaces IAS 1 (check ifrs.org).	mba/mba-three-statements-card, finance/ifrs-18-transition-plan
IFRS 18 categories	IFRS 18 classifies income and expenses into operating, investing, financing, income taxes and discontinued operations, and requires two subtotals: operating profit and profit before financing and income taxes.	mba/mba-three-statements-card
Management-defined performance measures (MPMs)	Under IFRS 18, subtotals of income and expenses that management uses in public communication and that IFRS does not define; they are disclosed in one note with a reconciliation to the closest IFRS subtotal.	mba/mba-ratio-analysis-card
Non-GAAP measure	Any performance measure not defined by the reporting framework, such as adjusted EBITDA; regulators require a reconciliation to the nearest defined measure.	mba/mba-ratio-analysis-card
Ratio analysis	Comparing items in the statements (margins, turnover, leverage, liquidity, returns) over time and against peers to understand performance.	mba/mba-ratio-analysis-card
Return on equity and DuPont analysis	Net income divided by shareholders' equity, split into profit margin times asset turnover times financial leverage to show where returns come from.	mba/mba-ratio-analysis-card
Free cash flow	Cash from operations less capital expenditure (or, for valuation, after-tax operating profit plus non-cash charges minus investment in capital and working capital).	mba/mba-cash-flow-statement-card
Quality of earnings	How well reported profit reflects sustainable, cash-backed performance rather than one-offs or aggressive estimates.	mba/mba-financial-accounting-guide
IFRS and US GAAP	The two main reporting frameworks: IFRS Accounting Standards from the IASB, used in most jurisdictions, and US GAAP from the FASB.	mba/mba-financial-accounting-guide

4. Managerial accounting

Term	Definition	Learn it in
Fixed cost	A cost that does not change with volume within a relevant range, such as rent.	mba/mba-cvp-breakeven-card
Variable cost	A cost that changes in proportion to volume, such as materials per unit.	mba/mba-cvp-breakeven-card
Contribution margin	Price minus variable cost per unit; what each unit contributes to fixed costs and profit.	mba/mba-cvp-breakeven-card
Break-even point	The volume or revenue at which profit is zero. Example: fixed costs of USD 600,000 and a 40% contribution margin ratio give break-even revenue of USD 1.5m (`=600000/0.4`).	mba/mba-cvp-breakeven-card
Cost-volume-profit (CVP) analysis	Modelling how profit responds to changes in price, volume, variable cost and fixed cost.	mba/mba-cvp-breakeven-card
Operating leverage	The sensitivity of operating profit to sales, high when fixed costs are a large share of total cost.	mba/mba-cvp-breakeven-card
Relevant cost	A future cost that differs between the options being compared; only these matter for the decision.	mba/mba-relevant-costs-card
Sunk cost	A cost already incurred that no decision can change; it is irrelevant to the choice, even though people often weigh it.	mba/mba-relevant-costs-card
Opportunity cost	The value of the best alternative given up by a choice.	mba/mba-relevant-costs-card
Make-or-buy decision	Choosing whether to produce internally or outsource by comparing relevant costs and strategic factors.	mba/mba-relevant-costs-card
Activity-based costing (ABC)	Assigning overhead to products through the activities that drive it, rather than by volume alone (Cooper and Kaplan 1988).	mba/mba-activity-based-costing-card
Cost driver	The activity measure that causes a cost to change, such as number of set-ups or orders.	mba/mba-activity-based-costing-card
Absorption and variable costing	Absorption costing includes fixed manufacturing overhead in inventory; variable costing expenses it in the period. Profit differs when inventory levels change.	mba/mba-managerial-accounting-guide
Budget and variance	A financial plan for a period, and the difference between actual and budgeted results, split into price and quantity effects.	mba/mba-managerial-accounting-guide
Transfer price	The price one division charges another inside the same company; it affects divisional performance and, across borders, tax.	mba/mba-managerial-accounting-guide
Balanced scorecard	A performance system that links strategy to measures in four perspectives: financial, customer, internal process, and learning and growth (Kaplan and Norton 1992).	mba/mba-managerial-accounting-guide
Responsibility centre	A unit whose manager is accountable for costs, revenue, profit or investment, which decides how it is measured.	mba/mba-managerial-accounting-guide

5. Corporate finance and valuation

Term	Definition	Learn it in
Time value of money	A unit of money today is worth more than the same amount later because it can be invested to earn a return.	mba/pre-mba-finance-primer
Present value and discount rate	The value today of a future cash flow, found by dividing it by one plus the discount rate for each period of delay.	mba/mba-npv-irr-card
Net present value (NPV)	The sum of the present values of a project's cash flows minus its cost; accept when positive. Example: USD 1,000 today for USD 400 a year for three years at 10% gives NPV of USD -5.26 (`=NPV(0.1,400,400,400)-1000`).	mba/mba-npv-irr-card
Internal rate of return (IRR)	The discount rate at which NPV is zero. It can mislead with unconventional cash flows or when comparing projects of different size.	mba/mba-npv-irr-card
Payback period	The time a project takes to recover its initial outlay; simple but ignores cash after payback and, in its basic form, the time value of money.	mba/mba-npv-irr-card
Compound annual growth rate (CAGR)	The constant yearly rate that takes a starting value to an ending value. Example: 100 to 150 in three years is 14.47% a year (`=RRI(3,100,150)`).	mba/pre-mba-finance-primer
Rule of 72	A shortcut for doubling time: 72 divided by the percentage rate. At 8% it gives 9 years against an exact 9.006 (`=NPER(0.08,0,-1,2)`).	mba/pre-mba-finance-primer
Annuity and perpetuity	A level cash flow for a fixed number of periods, and one that continues forever; both have closed-form present values.	mba/mba-formula-sheet
Diversification	Reducing risk by holding assets whose returns do not move together; it removes firm-specific risk but not market risk (Markowitz 1952).	mba/mba-capm-wacc-card
Beta	A measure of how much an asset's return moves with the market; the risk that diversification cannot remove.	mba/mba-capm-wacc-card
Capital asset pricing model (CAPM)	Expected return equals the risk-free rate plus beta times the market risk premium (Sharpe 1964, Lintner 1965).	mba/mba-capm-wacc-card
Equity risk premium	The extra return investors expect from equities over a risk-free asset; estimates differ by method and date.	mba/mba-capm-wacc-card
Weighted average cost of capital (WACC)	The blended required return of debt and equity holders, weighted by market values, with debt cost taken after tax.	mba/mba-capm-wacc-card
Discounted cash flow (DCF) valuation	Valuing a business as the present value of its expected free cash flows plus a terminal value.	mba/mba-dcf-valuation-card
Terminal value	The value of cash flows beyond the explicit forecast, often by the growing perpetuity (Gordon) formula or an exit multiple.	mba/mba-dcf-valuation-card
Enterprise value (EV)	The value of the operating business to all capital providers: equity value plus net debt and other non-equity claims.	mba/mba-dcf-valuation-card
Trading multiples (comparables)	Valuing a company by applying peers' ratios, such as EV/EBITDA or price/earnings, to its own metrics.	mba/mba-dcf-valuation-card, finance/comparable-companies-analysis
Capital structure	The mix of debt and equity a company uses to finance its assets.	mba/mba-capital-structure-card
Modigliani-Miller propositions	In perfect markets, firm value does not depend on capital structure (1958); with corporate taxes, debt adds value through the interest tax shield (1963).	mba/mba-capital-structure-card
Trade-off theory	Firms choose leverage by balancing the tax benefit of debt against the expected costs of financial distress.	mba/mba-capital-structure-card
Pecking order theory	Because managers know more than investors, firms prefer internal funds, then debt, then equity (Myers 1984, Myers and Majluf 1984).	mba/mba-capital-structure-card
Interest tax shield	The tax saved because interest is deductible: interest expense times the tax rate, subject to local limits.	mba/mba-capital-structure-card
Payout policy	How a company returns cash to shareholders through dividends and share buybacks.	mba/mba-capital-structure-card
Call and put option	The right, not the obligation, to buy (call) or sell (put) an asset at a set strike price on or before a set date.	mba/mba-options-real-options-card
Black-Scholes-Merton model	A formula for the price of a European option from the asset price, strike, time, volatility and risk-free rate (Black and Scholes 1973, Merton 1973).	mba/mba-options-real-options-card
Real option	A managerial right to expand, delay, switch or abandon a project, which adds value that a static NPV misses.	mba/mba-options-real-options-card
Efficient market hypothesis	Asset prices reflect available information, in weak, semi-strong or strong form, so beating the market consistently is hard (Fama 1970).	mba/mba-corporate-finance-guide
Agency cost	The loss from conflicts between managers and owners, or owners and lenders, plus the cost of monitoring and bonding (Jensen and Meckling 1976).	mba/mba-corporate-finance-guide

6. Economics

Term	Definition	Learn it in
Demand curve	The relationship between price and quantity buyers want, holding other factors constant.	mba/mba-demand-elasticity-card
Price elasticity of demand	The percentage change in quantity demanded for a one percent change in price; demand is elastic when the absolute value exceeds one.	mba/mba-demand-elasticity-card
Cross-price and income elasticity	How demand for one good responds to the price of another (substitutes positive, complements negative) or to buyers' income.	mba/mba-demand-elasticity-card
Marginal cost and marginal revenue	The change in total cost, or total revenue, from one more unit; profit is highest where they are equal.	mba/mba-pricing-card
Consumer surplus	The difference between what buyers would be willing to pay and what they actually pay.	mba/mba-pricing-card
Price discrimination	Charging different prices to different customers or for different quantities to capture more consumer surplus.	mba/mba-pricing-card
Perfect competition	A market with many sellers of identical products and free entry, where price equals marginal cost in the long run.	mba/mba-market-structure-card
Monopoly and monopolistic competition	One seller with pricing power, and many sellers of differentiated products with some pricing power but free entry.	mba/mba-market-structure-card
Oligopoly	A market with a few interdependent sellers whose choices depend on what rivals do.	mba/mba-market-structure-card
Barriers to entry	Conditions that make it hard for new firms to enter, such as scale economies, switching costs or regulation.	mba/mba-market-structure-card
Economies of scale and scope	Lower average cost from higher volume (scale) or from producing related products together (scope).	mba/mba-market-structure-card
Network effects	A product becomes more valuable to each user as more people use it.	mba/mba-market-structure-card
Game theory	The study of strategic decisions where each player's payoff depends on others' choices.	mba/mba-game-theory-card
Nash equilibrium	A set of strategies in which no player can do better by changing their own strategy alone (Nash 1950).	mba/mba-game-theory-card
Prisoner's dilemma	A game in which each player's dominant strategy leads to an outcome worse for both than cooperation.	mba/mba-game-theory-card
Information asymmetry	One party knows more than the other, which can produce adverse selection (Akerlof 1970) or moral hazard.	mba/mba-microeconomics-guide
Signalling	A costly action by the informed party that reveals quality, such as a warranty or an education credential (Spence 1973).	mba/mba-microeconomics-guide
Externality	A cost or benefit that falls on people outside a transaction, such as pollution.	mba/mba-microeconomics-guide
Gross domestic product (GDP)	The market value of final goods and services produced in an economy in a period; real GDP removes price changes.	mba/mba-macro-indicators-card
Inflation and CPI	The rise in the general price level, commonly measured by a consumer price index.	mba/mba-macro-indicators-card
Monetary policy	Central bank actions on interest rates and its balance sheet to influence inflation and activity.	mba/mba-macro-indicators-card
Fiscal policy	Government decisions on spending and taxes.	mba/mba-macroeconomics-guide
Exchange rate	The price of one currency in terms of another; a spot rate is for immediate delivery and a forward rate for a future date.	mba/mba-fx-interest-parity-card
Interest rate parity	Covered parity: the forward premium on a currency equals the interest rate differential between the two currencies, otherwise arbitrage is possible.	mba/mba-fx-interest-parity-card
Purchasing power parity	Over the long run, exchange rates tend to move to equalise the price of the same basket of goods across countries.	mba/mba-fx-interest-parity-card
Comparative advantage	A country or firm gains from trade by specialising in what it gives up least to produce, even if it is not best at anything.	-
Prospect theory and loss aversion	People judge outcomes as gains or losses from a reference point and feel losses more strongly than equal gains (Kahneman and Tversky 1979).	-

7. Statistics and analytics

Term	Definition	Learn it in
Random variable and distribution	A quantity whose value depends on chance, and the description of how likely each value is.	academic/stats-probability-basics
Expected value	The probability-weighted average outcome of an uncertain quantity.	mba/mba-decision-trees-card
Standard deviation and variance	Measures of spread around the mean; variance is the square of the standard deviation.	mba/pre-mba-quant-refresher
Normal distribution	The symmetric bell-shaped distribution set by its mean and standard deviation; about 95% of values lie within 1.96 standard deviations.	academic/stats-distributions-sheet
Sampling distribution and standard error	The distribution of a statistic across repeated samples, and its standard deviation.	academic/stats-sampling-distributions
Confidence interval	A range computed from data by a method that, in repeated samples, captures the true value a stated share of the time, such as 95%.	academic/stats-confidence-intervals
Hypothesis test and p-value	A test of whether data are consistent with a null hypothesis; the p-value is the probability of data at least this extreme if the null were true, not the probability the null is true.	academic/stats-hypothesis-testing
Type I and Type II error	Rejecting a true null (false positive) and failing to reject a false null (false negative).	academic/stats-hypothesis-testing
Statistical power	The probability that a test detects an effect of a given size when it exists.	academic/stats-power-sample-size
Correlation	A measure from -1 to 1 of how strongly two variables move together linearly; it does not show causation.	academic/stats-correlation
Linear regression	A model of an outcome as a linear function of predictors, estimated by least squares.	mba/mba-regression-for-managers-card
Coefficient and R-squared	The estimated change in the outcome for a one-unit change in a predictor, others held fixed, and the share of outcome variation the model explains.	mba/mba-regression-for-managers-card
Omitted variable bias	Distortion in a coefficient when a variable that affects both predictor and outcome is left out of the model.	mba/mba-regression-for-managers-card
Logistic regression	A regression for a yes or no outcome that models the log odds as a linear function of predictors.	academic/stats-logistic-regression
A/B test (randomised experiment)	Randomly assigning users to versions to measure the causal effect of a change.	academic/stats-experiment-design
Decision tree	A diagram of choices, chance events, probabilities and payoffs solved backwards by expected value.	mba/mba-decision-trees-card
Expected value of perfect information	The most a decision maker should pay to remove uncertainty before deciding.	mba/mba-decision-trees-card
Sensitivity and scenario analysis	Changing one input at a time (sensitivity) or a coherent set of inputs (scenario) to see how the result moves.	mba/mba-decision-analytics-guide
Monte Carlo simulation	Drawing many random values of uncertain inputs to build a distribution of outcomes.	mba/mba-decision-analytics-guide
Linear programming	Optimising a linear objective subject to linear constraints, solved in Excel with Solver.	mba/mba-decision-analytics-guide
Time series and forecasting	Data indexed by time, and methods that project it forward using trend, seasonality and past values.	academic/stats-time-series-arima

8. Marketing

Term	Definition	Learn it in
Segmentation	Dividing a market into groups of customers with similar needs or responses.	mba/mba-stp-positioning-card
Targeting	Choosing which segments to serve, based on attractiveness and fit with the firm's strengths.	mba/mba-stp-positioning-card
Positioning	The distinct place a brand aims to hold in target customers' minds relative to competitors.	mba/mba-stp-positioning-card
Positioning statement	A one-sentence internal statement of target, frame of reference, point of difference and reason to believe.	mba/mba-stp-positioning-card
Value proposition	The specific benefits a customer receives, net of cost, compared with alternatives.	mba/mba-stp-positioning-card
Marketing mix (4Ps)	Product, price, place and promotion, the decisions that put a positioning into practice (McCarthy 1960).	mba/mba-marketing-mix-card
Customer lifetime value (CLV)	The present value of the margins a customer is expected to generate over the relationship, net of retention costs (Gupta, Lehmann and Stuart 2004).	mba/mba-customer-lifetime-value-card
Customer acquisition cost (CAC)	Total sales and marketing spend to win new customers divided by the number won.	mba/mba-customer-lifetime-value-card
Retention and churn rate	The share of customers who stay, and who leave, in a period.	mba/mba-customer-lifetime-value-card
Brand equity	The value a brand adds to a product through awareness, associations and loyalty.	mba/mba-marketing-guide
Conjoint analysis	A survey method that infers how much customers value each product attribute from their choices among bundles.	mba/mba-stp-positioning-card
Willingness to pay	The highest price a customer would pay for a product.	mba/mba-pricing-card
Value-based pricing	Setting price from the customer's perceived value rather than from cost.	mba/mba-pricing-card
Marketing funnel	The stages from awareness to consideration, purchase and loyalty, used to find where customers drop out.	mba/mba-marketing-guide
Net Promoter Score	The percentage of promoters minus the percentage of detractors from a 0 to 10 likelihood-to-recommend question (Reichheld 2003).	-
Diffusion of innovations	The pattern by which a new product spreads through innovators, early adopters, the majority and laggards (Rogers 1962).	mba/mba-marketing-guide
Bass diffusion model	A model of new-product adoption from an innovation coefficient and an imitation coefficient (Bass 1969).	mba/mba-marketing-guide
Channel	The route by which a product reaches the customer, such as direct, retail or marketplace.	mba/mba-marketing-mix-card
Go-to-market strategy	The plan for which customers to reach, through which channels, with what message and price, at launch.	mba/mba-marketing-guide
Marketing attribution	Assigning credit for a sale to the touchpoints that preceded it.	mba/mba-marketing-guide

9. Operations

Term	Definition	Learn it in
Process flow diagram	A map of the steps, buffers and flows that turn inputs into outputs.	mba/mba-process-analysis-card
Capacity	The maximum output rate of a resource or process.	mba/mba-process-analysis-card
Bottleneck	The resource with the lowest capacity, which sets the capacity of the whole process.	mba/mba-process-analysis-card
Utilisation	The ratio of actual flow rate to capacity for a resource.	mba/mba-process-analysis-card
Throughput (flow rate)	The number of units passing through a process per unit of time.	mba/mba-process-analysis-card
Cycle time and takt time	The time between completed units, and the cycle time needed to match customer demand.	mba/mba-process-analysis-card
Little's Law	Average inventory equals average flow rate times average flow time (Little 1961). Example: 30 patients an hour staying 0.5 hours means 15 patients in the unit on average (`=30*0.5`).	mba/mba-process-analysis-card
Economic order quantity (EOQ)	The order size that minimises the sum of ordering and holding costs (Harris 1913).	mba/mba-inventory-card
Safety stock	Extra inventory held to protect against variation in demand or lead time.	mba/mba-inventory-card
Newsvendor model	Choosing a one-off order quantity under uncertain demand by balancing the cost of too much against the cost of too little.	mba/mba-inventory-card
Bullwhip effect	Order variability growing as it moves up a supply chain from retailer to supplier (Lee, Padmanabhan and Whang 1997).	mba/mba-operations-guide
Queueing	The study of waiting lines; waits rise sharply as utilisation approaches 100%.	mba/mba-queueing-card
Variability (coefficient of variation)	The standard deviation divided by the mean of arrival or service times, a driver of waiting time.	mba/mba-queueing-card
Lean production	A management system that removes waste and makes flow smooth, from the Toyota Production System.	mba/mba-quality-card
Six Sigma and DMAIC	A quality method aimed at very low defect rates, run through Define, Measure, Analyse, Improve, Control.	mba/mba-quality-card
Statistical process control	Using control charts to tell common-cause variation from special-cause variation (Shewhart 1931).	mba/mba-quality-card
Theory of constraints	Managing a system by finding and exploiting its constraint (Goldratt and Cox 1984).	mba/mba-operations-guide
Supply chain resilience	A supply chain's ability to absorb and recover from disruption, through buffers, flexibility and multiple sources.	mba/mba-operations-guide

10. Strategy

Term	Definition	Learn it in
Strategy	The set of choices about where to compete and how to win that gives a firm an advantage it can sustain.	mba/mba-strategy-guide
Five forces	Industry profitability is shaped by rivalry, the threat of entry, the threat of substitutes and the power of buyers and suppliers (Porter 1979, 1980).	mba/mba-five-forces-card
Complementors	Firms whose products make yours more valuable, sometimes analysed alongside the five forces.	mba/mba-five-forces-card
Value chain	The activities a firm performs to create value, primary and support, used to locate sources of cost or differentiation (Porter 1985).	mba/mba-value-chain-card
Competitive advantage	Creating more economic value than rivals, as a wider gap between customers' willingness to pay and the firm's cost.	mba/mba-competitive-advantage-card
Cost leadership and differentiation	Porter's generic strategies: win on lower cost or on a higher willingness to pay, broadly or in a focused niche (Porter 1980).	mba/mba-competitive-advantage-card
Resource-based view (RBV)	Sustained advantage comes from resources that are valuable, rare, hard to imitate and non-substitutable (Barney 1991).	mba/mba-resource-based-view-card
VRIO	A test of whether a resource is valuable, rare, costly to imitate and supported by the organisation, Barney's later extension of the RBV criteria.	mba/mba-resource-based-view-card
Core competence	A combination of skills and technologies that gives access to many markets and is hard to copy (Prahalad and Hamel 1990).	mba/mba-resource-based-view-card
Dynamic capabilities	A firm's ability to integrate, build and reconfigure competences as the environment changes (Teece, Pisano and Shuen 1997).	mba/mba-resource-based-view-card
Ansoff matrix	Growth options by product and market: market penetration, market development, product development and diversification (Ansoff 1957).	mba/mba-growth-strategy-card
Vertical integration	Owning stages of the value chain upstream (suppliers) or downstream (distribution).	mba/mba-growth-strategy-card
Diversification (corporate)	Entering businesses different from the current ones; related diversification shares resources, unrelated does not.	mba/mba-growth-strategy-card
Disruptive innovation	A simpler, cheaper offering that starts at the low end or in a new market and moves up until it displaces incumbents (Christensen 1997).	mba/mba-growth-strategy-card
Blue ocean strategy	Creating uncontested market space by raising some value factors and removing others (Kim and Mauborgne 2005).	mba/mba-competitive-advantage-card
Platform and two-sided market	A business that creates value by connecting two or more user groups whose participation depends on each other.	mba/mba-strategy-guide
Transaction cost economics	Firms exist when organising an activity inside is cheaper than buying it in the market (Coase 1937, Williamson 1975).	mba/mba-strategy-guide
SWOT analysis	A summary of internal strengths and weaknesses and external opportunities and threats; a starting list, not an analysis by itself.	business/swot
PESTEL	A scan of political, economic, social, technological, environmental and legal factors in the environment.	mba/mba-strategy-guide
Mergers and acquisitions (M&A)	Combining companies by merger or purchase, judged by whether the synergies exceed the premium paid.	mba/mba-strategy-guide

11. Organisational behaviour and leadership

Term	Definition	Learn it in
Motivation-hygiene theory	Some factors (achievement, recognition) motivate, while others (pay, conditions) only prevent dissatisfaction (Herzberg 1959).	mba/mba-motivation-card
Expectancy theory	Motivation depends on the belief that effort leads to performance, that performance leads to outcomes and on how much the outcomes are valued (Vroom 1964).	mba/mba-motivation-card
Goal-setting theory	Specific, difficult goals with feedback lead to higher performance than vague goals (Locke 1968).	mba/mba-motivation-card
Job characteristics model	Skill variety, task identity, task significance, autonomy and feedback make work more motivating (Hackman and Oldham 1976).	mba/mba-motivation-card
Intrinsic and extrinsic motivation	Doing a task for its own sake, and doing it for an outside reward.	mba/mba-motivation-card
Team development stages	Forming, storming, norming and performing (Tuckman 1965), with adjourning added later.	mba/mba-team-dynamics-card
Psychological safety	A shared belief in a team that it is safe to take interpersonal risks such as admitting a mistake (Edmondson 1999).	mba/mba-team-dynamics-card
Groupthink	A group's drive for agreement that suppresses dissent and leads to poor decisions (Janis 1972).	mba/mba-team-dynamics-card
Transformational leadership	Leading by inspiring followers to look beyond self-interest to a shared purpose (Burns 1978, Bass 1985).	mba/mba-leadership-guide
Emotional intelligence	The ability to perceive, understand and manage one's own and others' emotions (Salovey and Mayer 1990; popularised by Goleman 1995).	mba/mba-leadership-guide
Situational leadership	Adapting leadership style to the follower's competence and commitment on the task (Hersey and Blanchard 1969).	mba/mba-leadership-guide
Eight-step change model	Kotter's sequence for leading change, from creating urgency to anchoring new approaches in the culture (Kotter 1995).	mba/mba-change-management-card
Unfreeze, change, refreeze	Lewin's three-stage view of organisational change (Lewin 1947).	mba/mba-change-management-card
Organisational culture	The shared assumptions, values and norms that shape how people in an organisation behave.	mba/mba-leadership-guide
360-degree feedback	Feedback on a person's behaviour gathered from managers, peers, direct reports and self.	mba/mba-leadership-360-reflection
Situation-Behaviour-Impact (SBI)	A feedback model from the Center for Creative Leadership: describe the situation, the observable behaviour and its impact.	mba/mba-peer-feedback
Cultural dimensions	Ways national cultures differ, such as power distance and individualism (Hofstede 1980).	mba/mba-leadership-guide
Interpersonal dynamics	The study of how people affect each other in close working relationships, often taught through small-group experiential courses.	mba/mba-interpersonal-dynamics-journal

12. Negotiation

Term	Definition	Learn it in
BATNA	Best alternative to a negotiated agreement: what you will do if this deal fails (Fisher and Ury 1981).	mba/mba-negotiation-planner
Reservation price (walk-away point)	The worst terms you would accept, set by your BATNA.	mba/mba-negotiation-planner
Target (aspiration)	The ambitious but justifiable outcome you aim for.	mba/mba-negotiation-planner
ZOPA	Zone of possible agreement: the range between the two parties' reservation prices; with no overlap, no deal is possible (Raiffa 1982).	mba/mba-negotiation-guide
Anchoring	The tendency of the first number on the table to pull the final outcome towards it (Tversky and Kahneman 1974).	mba/mba-negotiation-guide
Distributive negotiation	Bargaining over a fixed amount of value, where one side's gain is the other's loss.	mba/mba-negotiation-guide
Integrative negotiation	Creating value by trading on issues the parties value differently.	mba/mba-negotiation-guide
Interests versus positions	Positions are what parties say they want; interests are why they want it. Deals come from interests (Fisher and Ury 1981).	mba/mba-negotiation-guide
Logrolling	Conceding on issues you value less in exchange for gains on issues you value more.	mba/mba-negotiation-guide
Contingent agreement	A deal whose terms depend on a future event, used when parties disagree about what will happen.	mba/mba-negotiation-guide
Multi-party negotiation and coalitions	Negotiation among three or more parties, where alliances form and change.	mba/mba-negotiation-guide
Negotiation debrief	A structured review after a negotiation of preparation, value created, value claimed and lessons.	mba/mba-negotiation-debrief

13. Ethics, ESG and sustainability reporting

Term	Definition	Learn it in
Stakeholder theory	Managers should create value for all groups that affect or are affected by the firm, not only shareholders (Freeman 1984).	mba/mba-stakeholder-esg-card
Shareholder primacy	The view that a company's purpose is to maximise value for its shareholders within the law.	mba/mba-ethics-guide
ESG	Environmental, social and governance factors used by investors and managers to assess risks and impacts beyond financial results.	mba/mba-stakeholder-esg-card
Materiality and double materiality	Financial materiality asks how sustainability matters affect the company; double materiality, used under CSRD and ESRS, adds how the company affects people and the environment.	mba/mba-stakeholder-esg-card
CSRD	The EU Corporate Sustainability Reporting Directive. As of October 2026, Directive (EU) 2026/470 (Omnibus I) limits its scope to undertakings with more than 1,000 employees and over EUR 450 million net turnover, for financial years from 1 January 2027 (check EUR-Lex).	mba/mba-stakeholder-esg-card
ESRS	European Sustainability Reporting Standards, the detailed disclosure standards used under CSRD; a simplified revised set was adopted in 2026 (check EUR-Lex and efrag.org).	mba/mba-stakeholder-esg-card
ISSB and IFRS S1, S2	The International Sustainability Standards Board's standards: S1 on general sustainability-related financial disclosures and S2 on climate, issued in June 2023 and adopted or being introduced jurisdiction by jurisdiction (as of October 2026, check ifrs.org).	mba/mba-stakeholder-esg-card, finance/issb-sustainability-disclosure
Greenhouse gas scopes 1, 2, 3	Direct emissions (scope 1), purchased energy (scope 2) and other value-chain emissions (scope 3), as defined by the GHG Protocol.	mba/mba-stakeholder-esg-card
Greenwashing	Misleading claims about the environmental benefits of a product or company.	mba/mba-ethics-guide
Corporate governance	The system of boards, rights and controls through which a company is directed and held accountable.	mba/mba-ethics-guide
Conflict of interest	A situation where a personal interest could influence, or appear to influence, professional judgement.	mba/mba-ethics-guide
Ethical frameworks	Lenses for judging an action: consequences (utilitarian), duties and rights (deontological), and character (virtue ethics).	mba/mba-ethics-guide
Whistleblowing	Reporting wrongdoing inside an organisation to people or bodies able to act on it.	mba/mba-ethics-guide
Triple bottom line	Judging performance on people, planet and profit (Elkington 1997).	mba/mba-stakeholder-esg-card

14. Entrepreneurship and venture finance

Term	Definition	Learn it in
Opportunity assessment	Judging whether a venture idea addresses a real problem in a market large enough, with a team able to win.	mba/mba-opportunity-assessment-card
TAM, SAM, SOM	Total addressable market, the serviceable part the product can reach, and the share the venture can realistically obtain.	mba/mba-opportunity-assessment-card
Product-market fit	The point at which a product satisfies a market strongly enough that demand pulls growth.	mba/mba-opportunity-assessment-card
Minimum viable product (MVP)	The smallest version of a product that tests the riskiest assumption with real users (Ries 2011).	mba/mba-entrepreneurship-guide
Business model canvas	A one-page map of nine building blocks of how a business creates, delivers and captures value (Osterwalder and Pigneur 2010).	mba/mba-entrepreneurship-guide
Unit economics	Revenue and cost per unit of the business, such as per customer, to see if each sale creates value.	mba/mba-entrepreneurship-guide, finance/unit-economics-analysis
Burn rate and runway	Net cash spent per month, and the months until cash runs out at that rate.	mba/mba-entrepreneurship-guide
Pre-money and post-money valuation	The company value before and after new money. Example: USD 5m invested at USD 20m pre-money gives USD 25m post-money and a 20% stake (`=5/(20+5)`).	mba/mba-venture-finance-cap-table-card
Cap table	A table of who owns which shares, options and convertibles in a company, before and after each round.	mba/mba-venture-finance-cap-table-card
Dilution	The fall in existing holders' ownership percentage when new shares are issued.	mba/mba-venture-finance-cap-table-card
Option pool	Shares reserved for future employee equity, often created before a round so that it dilutes existing holders only.	mba/mba-venture-finance-cap-table-card
SAFE and convertible note	Instruments that convert into equity at a later priced round, often with a valuation cap or discount; a note is debt, a SAFE is not.	mba/mba-venture-finance-cap-table-card
Liquidation preference	The right of preferred shareholders to be paid back a set multiple of their investment before common holders in a sale.	mba/mba-venture-finance-cap-table-card
Anti-dilution protection	Terms that adjust investors' conversion price if a later round is priced lower.	mba/mba-venture-finance-cap-table-card
Vesting and cliff	Equity earned over time, usually with a first portion vesting only after a minimum period.	mba/mba-venture-finance-cap-table-card
Search fund and entrepreneurship through acquisition	A route in which an entrepreneur raises money to find, buy and run one small established company.	mba/mba-entrepreneurship-guide

15. AI for managers

Term	Definition	Learn it in
Machine learning	Methods that learn patterns from data to make predictions or decisions without explicit rules for each case.	mba/mba-ai-for-managers-guide
Supervised and unsupervised learning	Learning from labelled examples to predict an outcome, and finding structure such as clusters in unlabelled data.	mba/mba-ai-for-managers-guide
Generative AI	Models that produce new text, images, code or audio from a prompt.	mba/mba-ai-for-managers-guide
Large language model (LLM)	A neural network trained on large text corpora to predict the next token, used for writing, summarising, reasoning and tool use; most are built on the transformer architecture (Vaswani et al. 2017).	mba/mba-ai-for-managers-guide
Prompt	The instructions and context given to a generative model.	mba/mba-ai-for-managers-guide
Hallucination	A confident but false output from a generative model.	mba/mba-ai-risk-governance-card
Retrieval-augmented generation (RAG)	Giving a model relevant documents retrieved at query time so its answer is grounded in them.	mba/mba-ai-for-managers-guide
AI agent	A system in which a model plans and takes actions with tools, such as searching or updating records, towards a goal.	mba/mba-ai-strategy-card
Build, buy or partner	The choice between developing AI capability in-house, licensing a product or working with a provider.	mba/mba-ai-strategy-card
Data moat	Advantage from proprietary data that improves a product and is hard for rivals to obtain.	mba/mba-ai-strategy-card
Human in the loop	A design in which a person reviews or approves model outputs before they take effect.	mba/mba-ai-decision-making-card
Precision and recall	Of the cases a model flags, the share that are correct (precision), and of all true cases, the share it flags (recall).	mba/mba-ai-decision-making-card
Automation bias	Over-reliance on automated recommendations, even when they are wrong.	mba/mba-ai-decision-making-card
Algorithmic bias	Systematically unfair outcomes for some groups from data, model design or use.	mba/mba-ai-risk-governance-card
EU AI Act	Regulation (EU) 2024/1689 (the Artificial Intelligence Act), which sets risk-based rules for AI systems and general-purpose AI models in the EU, with obligations applying in stages from February 2025. As of October 2026 it has been amended by Regulation (EU) 2026/1744 (the "Digital Omnibus on AI"), which changed some obligations and application dates, so check the consolidated text on EUR-Lex.	mba/mba-ai-risk-governance-card
AI risk management frameworks	Voluntary structures for governing AI risk, such as the NIST AI Risk Management Framework 1.0 (2023) and the ISO/IEC 42001:2023 management system standard.	mba/mba-ai-risk-governance-card

16. Recruiting: consulting, banking, private equity and product

General recruiting

Term	Definition	Learn it in
On-campus recruiting	The structured process by which firms present, interview and hire students through the school's career centre, with set dates.	mba/mba-recruiting-plan
Off-cycle (off-campus) recruiting	Hiring outside the school calendar, common in tech, startups and smaller firms.	mba/mba-recruiting-plan
Summer internship	A ten to twelve week placement between the first and second year, often leading to a full-time offer.	mba/mba-internship-plan
Return offer	A full-time offer made at the end of a summer internship.	mba/mba-internship-final-presentation
Coffee chat	An informal conversation with someone at a target firm to learn about the work and build a relationship.	mba/mba-coffee-chat-notes
Networking tracker	A log of contacts, conversations and follow-ups during recruiting.	mba/mba-networking-tracker
Weak ties	Acquaintances outside a close circle, which are often the source of new job information (Granovetter 1973).	mba/mba-alumni-network-plan
Fit interview (behavioural)	An interview about past behaviour and motivation, answered with structured stories.	mba/mba-fit-stories
STAR method	Structuring a story as Situation, Task, Action and Result.	mba/mba-fit-stories
Offer negotiation	Discussing salary, signing bonus, start date and other terms after an offer, within the norms of the industry.	mba/mba-offer-negotiation
OPT and STEM OPT (US)	Optional Practical Training, which lets F-1 students work in the US after study, with a 24-month extension for degrees in designated STEM fields. Rules change, so check uscis.gov.	mba/mba-international-applicant-plan
H-1B (US)	A US work visa for specialty occupations, allocated by lottery. As of October 2026 a supplemental fee for some new petitions is subject to litigation; check uscis.gov before you rely on it.	mba/mba-international-applicant-plan

Consulting

Term	Definition	Learn it in
Case interview	An interview in which the candidate structures and solves a business problem aloud with the interviewer.	mba/mba-case-interview-prep
Interviewer-led and candidate-led case	Formats in which the interviewer directs each step, or the candidate drives the analysis.	mba/mba-case-interview-prep
Issue tree	A breakdown of a problem into branches that are mutually exclusive and collectively exhaustive.	mba/mba-case-interview-prep
MECE	Mutually exclusive, collectively exhaustive: a structure with no overlaps and no gaps.	mba/mba-case-interview-prep
Hypothesis-driven approach	Stating a likely answer early and testing it with data, rather than collecting everything first.	mba/mba-case-interview-prep
Market sizing	Estimating the size of a market from logical assumptions, top-down or bottom-up.	mba/mba-market-sizing-drills
Online assessment and AI screening	Digital tests or chatbot cases some firms use before interviews; formats change and unapproved AI use in interviews is generally prohibited.	mba/mba-case-interview-prep
Personal experience interview	A deep behavioural interview on one past experience, probed in detail.	mba/mba-fit-stories
Pyramid principle	Communicating the answer first, then the supporting arguments, then the data (Minto, The Pyramid Principle).	mba/mba-business-communication-card

Investment banking

Term	Definition	Learn it in
Superday	A final-round day of back-to-back interviews at one firm.	mba/mba-banking-technical-prep
Technical questions	Interview questions on accounting, valuation and deals, such as how a change flows through the three statements.	mba/mba-banking-technical-prep
Accretion and dilution	Whether an acquisition raises or lowers the buyer's earnings per share.	mba/mba-banking-technical-prep
Coverage and product groups	Banking teams organised by industry (coverage) or by transaction type (product, such as M&A or leveraged finance).	mba/mba-banking-technical-prep
Pitch book	A presentation a bank prepares to win a mandate or present a transaction.	mba/mba-banking-technical-prep

Private equity

Term	Definition	Learn it in
Leveraged buyout (LBO)	Buying a company with a large share of debt, repaid from its cash flows, to raise equity returns.	mba/mba-paper-lbo
Paper LBO	A quick LBO calculation done by hand in an interview.	mba/mba-paper-lbo
MOIC	Multiple on invested capital: total value returned divided by equity invested. Example: 2.5x in five years with no interim cash is an IRR of 20.11% (`=2.5^(1/5)-1`).	mba/mba-paper-lbo
Value creation levers	The sources of equity return in a buyout: operating improvement, multiple expansion and debt paydown.	mba/mba-paper-lbo
Carried interest and hurdle rate	The general partner's share of profits, paid only after investors receive a preferred return.	mba/mba-paper-lbo
On-cycle recruiting	A compressed, early hiring process used by some large buyout funds.	-

Product management

Term	Definition	Learn it in
Product sense interview	An interview on designing or improving a product for a user need.	mba/mba-product-interview-prep
Product execution interview	An interview on metrics, trade-offs and diagnosing a change in a product's numbers.	mba/mba-product-interview-prep
North star metric	The single measure that best captures the value a product delivers to users.	mba/mba-product-interview-prep
Product requirements document (PRD)	A document that states the problem, users, requirements and success measures for a feature.	mba/mba-product-interview-prep
Roadmap prioritisation	Ranking features by value, effort, risk and strategic fit, often with a scoring model.	mba/mba-product-interview-prep

My terms

Term	Definition	Learn it in
[Term] (Example)	[Your definition in your own words]	[Card, course session or source]
Section (Example)	The cohort of about 60 to 90 students who take the core courses together at some schools.	mba/mba-two-year-plan
[Term]	[Definition]	[Source]

Self-test

A project costs USD 1,000 today and returns USD 400 a year for three years. At 10% is it worth doing, and which Excel formula shows it?
What is the difference between a sunk cost and an opportunity cost, and which belongs in a decision?
Which two subtotals does IFRS 18 require, and from when does it apply?
Under IFRS 18, what must a company disclose about a management-defined performance measure?
Name the three GMAT Focus sections, their timing and the total score range, as of October 2026.
What does a TOEFL iBT score of 5 mean on the scale used from January 2026, and which CEFR level does it align with?
Explain BATNA and ZOPA in one sentence each and say how they are related.
A ward admits 30 patients an hour and each stays 0.5 hours. How many patients are in the ward on average, and which law gives the answer?
Why does a resource-based explanation of advantage ask whether a resource is hard to imitate?
An investor puts USD 5m into a company at USD 20m pre-money. What stake does the investor get?
What is the difference between precision and recall?
In a study session, what does interleaving mean and why does it help?

Sources and further reading

Official pages for dated facts (checked October 2026)

GMAC. GMAT Focus Edition exam structure and scoring. https://www.mba.com/exams/gmat-exam
GMAC. Executive Assessment. https://www.gmac.com/executive-assessment
ETS. GRE General Test structure. https://www.ets.org/gre/test-takers/general-test/prepare/test-structure.html
ETS. TOEFL iBT score scale update (2026). https://www.ets.org/toefl/institutions/ibt/score-scale-update.html
IFRS Foundation. IFRS 18 Presentation and Disclosure in Financial Statements. https://www.ifrs.org/issued-standards/list-of-standards/ifrs-18-presentation-and-disclosure-in-financial-statements/
IFRS Foundation. IFRS S1 and IFRS S2 and jurisdictional adoption. https://www.ifrs.org/sustainability/
European Union. Directive (EU) 2026/470 (Omnibus I) on EUR-Lex. https://eur-lex.europa.eu/eli/dir/2026/470/oj/eng
European Union. Regulation (EU) 2024/1689 (AI Act) on EUR-Lex. https://eur-lex.europa.eu/eli/reg/2024/1689/oj/eng
AACSB. Global Standards for Business Education (2026). https://www.aacsb.edu/educators/accreditation
US Department of Education. Federal student aid, loan limits. https://studentaid.gov
USCIS. Optional Practical Training and H-1B. https://www.uscis.gov

Learning research

Dunlosky, J., Rawson, K. A., Marsh, E. J., Nathan, M. J., and Willingham, D. T. (2013). Improving students' learning with effective learning techniques. Psychological Science in the Public Interest, 14(1), 4-58.
Roediger, H. L., and Karpicke, J. D. (2006). Test-enhanced learning. Psychological Science, 17(3), 249-255.
Cepeda, N. J., Pashler, H., Vul, E., Wixted, J. T., and Rohrer, D. (2006). Distributed practice in verbal recall tasks. Psychological Bulletin, 132(3), 354-380.
Rohrer, D., and Taylor, K. (2007). The shuffling of mathematics problems improves learning. Instructional Science, 35(6), 481-498.

Primary works for frameworks named in the entries (selection)

Porter, M. E. (1979). How competitive forces shape strategy. Harvard Business Review, 57(2), 137-145.
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99-120.
Sharpe, W. F. (1964). Capital asset prices: A theory of market equilibrium under conditions of risk. Journal of Finance, 19(3), 425-442.
Modigliani, F., and Miller, M. H. (1958). The cost of capital, corporation finance and the theory of investment. American Economic Review, 48(3), 261-297.
Myers, S. C., and Majluf, N. S. (1984). Corporate financing and investment decisions when firms have information that investors do not have. Journal of Financial Economics, 13(2), 187-221.
Black, F., and Scholes, M. (1973). The pricing of options and corporate liabilities. Journal of Political Economy, 81(3), 637-654.
Little, J. D. C. (1961). A proof for the queuing formula: L = λW. Operations Research, 9(3), 383-387.
Kaplan, R. S., and Norton, D. P. (1992). The balanced scorecard: Measures that drive performance. Harvard Business Review, 70(1), 71-79.
Nash, J. F. (1950). Equilibrium points in n-person games. Proceedings of the National Academy of Sciences, 36(1), 48-49.
Tuckman, B. W. (1965). Developmental sequence in small groups. Psychological Bulletin, 63(6), 384-399.
Edmondson, A. (1999). Psychological safety and learning behavior in work teams. Administrative Science Quarterly, 44(2), 350-383.
Gupta, S., Lehmann, D. R., and Stuart, J. A. (2004). Valuing customers. Journal of Marketing Research, 41(1), 7-18.
Bass, F. M. (1969). A new product growth for model consumer durables. Management Science, 15(5), 215-227.
Akerlof, G. A. (1970). The market for "lemons": Quality uncertainty and the market mechanism. Quarterly Journal of Economics, 84(3), 488-500.
Jensen, M. C., and Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305-360.
Kahneman, D., and Tversky, A. (1979). Prospect theory: An analysis of decision under risk. Econometrica, 47(2), 263-291.
Books named in entries: Porter (1980) Competitive Strategy and (1985) Competitive Advantage; Fisher and Ury (1981) Getting to Yes; Raiffa (1982) The Art and Science of Negotiation; Christensen (1997) The Innovator's Dilemma; Kim and Mauborgne (2005) Blue Ocean Strategy; Freeman (1984) Strategic Management: A Stakeholder Approach; Kolb (1984) Experiential Learning; Schön (1983) The Reflective Practitioner.

Textbooks and open resources (further reading only)

Berk and DeMarzo, Corporate Finance; Brealey, Myers and Allen, Principles of Corporate Finance.
Kotler and Keller, Marketing Management; Cachon and Terwiesch, Matching Supply with Demand.
Besanko, Dranove, Shanley and Schaefer, Economics of Strategy; Robbins and Judge, Organizational Behavior.
OpenStax (free; CC BY 4.0 or CC BY-NC-SA 4.0 by title): Principles of Accounting, Principles of Economics, Principles of Management (openstax.org).

Answer key

No. NPV is USD -5.26 (=NPV(0.1,400,400,400)-1000), slightly negative, so at 10% the project does not cover its cost of capital. See mba/mba-npv-irr-card.
A sunk cost is already spent and cannot be changed by the decision, so it is ignored. An opportunity cost is the value of the best alternative given up, so it is included. See mba/mba-relevant-costs-card.
Operating profit and profit before financing and income taxes. As of October 2026 IFRS 18 applies to annual periods beginning on or after 1 January 2027, with earlier application permitted.
It must be disclosed in a single note with a reconciliation to the most directly comparable subtotal defined by IFRS, plus an explanation of why the measure is useful; the note also shows the tax and non-controlling interest effects of the reconciling items. See mba/mba-ratio-analysis-card and finance/ifrs-18-transition-plan.
Quantitative Reasoning, Verbal Reasoning and Data Insights, 45 minutes each, total score 205 to 805 (section scores 60 to 90), no essay. Check mba.com before you book.
Band 5 aligns with CEFR C1 on every section and the total; the overall band is the average of the four section bands rounded to the nearest half band. Check ets.org for the current concordance with the 0 to 120 scale.
BATNA is what you will do if no deal is reached; ZOPA is the range between the two sides' reservation prices. Each side's BATNA sets its reservation price, so the BATNAs determine whether a ZOPA exists.
15 patients (=30*0.5), by Little's Law, L equals the arrival rate times the average time in the system.
Because a valuable resource that rivals can copy or substitute gives only a temporary advantage; the advantage is sustained only when imitation is costly (Barney 1991).
20%: post-money is USD 25m and USD 5m divided by USD 25m is 0.20 (=5/(20+5)).
Precision is the share of flagged cases that are truly positive; recall is the share of all truly positive cases that the model flags. Raising one usually lowers the other.
Interleaving mixes cards or problems from different topics in one session. It helps because you must first recognise which idea or method applies, the skill a cold call or exam requires (Rohrer and Taylor 2007).

Revision history

Version	Date	Author	Change
0.1	2026-10-28	[Your name]	First version from the template: 16 areas, dated facts checked October 2026
[0.2]	YYYY-MM-DD	[Name]	[Re-checked test formats and reporting standards, added my terms]

Standard and licence note

Based on the original works and official pages listed in "Sources and further reading": GMAC (GMAT Focus Edition, Executive Assessment), ETS (GRE, TOEFL iBT score scale from 21 January 2026), the IFRS Foundation (IFRS 18, IFRS S1 and S2), EUR-Lex (Directive (EU) 2026/470, Regulation (EU) 2024/1689) and AACSB (Global Standards for Business Education, 2026), as checked in October 2026. All definitions are original text written for this library; no textbook, published case, test question or school material is copied or paraphrased. The template is not affiliated with or endorsed by any school, test owner or standard setter, and school names appear only to describe public formats. Test formats, loan rules, visa rules and reporting standards change, so check the current official version before you rely on any dated fact. This is a study aid, not admissions, legal, tax or financial advice. Template licence: MIT.