Chapter 1 Flashcards
what’s a business?
an organization that exists to produce or sell goods and services to satisfy the needs and wants of consumers
what’s the purpose of a for-profit business?
to make money
what’s it called when a business can pay its debts?
the business is considered solvent
what can a business do with its profit?
- reinvest
- provide improved goods and services
- give the owners(s) funds for personal needs or wants
what’s the purpose of a non-profit organization?
to raise money for a specific goal
what do not-for-profit organizations do with their surplus funds?
they improve services offered to its members
list five forms of business ownership
- sole proprietorship
- partnership
- corporation
- co-operative
- franchise
what are producers?
the businesses that make goods or provide services that consumers need or want
what are consumers?
the people who purchase goods and services from producers
what’s a marketplace?
a location where producers and consumers come together to buy and sell their goods and services
when are businesses in control?
when they have pricing power
what is pricing power?
when businesses can increase prices and consumers will still buy their goods or services
when are consumers in control?
when they have purchasing power
what is purchasing power?
when consumers can buy goods and services at the places and prices that they want
