Chapter 1 - Exploring the World of Business Flashcards
(22 cards)
Potential Benefits of Studying Business
-Help choose a career
-Can improve your career
-Be a better informed consumer and investor
-Can help you be a more influential community member
What is a Business?
An organization that seeks profit by offering products to satisfy society’s needs which can be in a form of a good or service.
What are Goods and Services?
-Goods: tangible product
-Service: intangible product
Key Business Activities
-Marketing & Sales
-Accounting & Finance
-Production & Operations
-Human Resources
-Research & Development
Fundamentals of Business
-Ethics
-Leadership
-Product Development
-Accounting
4 types of Resources
- Material: raw materials use in manufacturing
- Human: people who provide labour in exchange to wage
- Financial: money required to pay employees, purchase materials, and keep businesses operating.
- Informational: tells the manager of the business how to effectively the other three resources are combined and used.
Ways Companies Offer Variety
- Increasing Quality
- Increased Choice
- Increased Convenience
- Increased Health & Safety
- Increased Value for Money
Standard of Living
refers to the amount of products available, wealth of the nation, and lifestyle opportunities.
Quality of Life
the general well-being and happiness of people and societies. May include access to healthcare, education, and food.
Improving Quality of Life
- Paying Taxes
- Charitable Giving & Community Development
- Contributing to Economic Growth
Concerns about the Impact of Businesses on Society
- Health and Safety Risks
- Environmental Damage
- Community Impacts
Five Factors of Business Environment:
- Political
- Economic and Competitive
- Social
- Technological
- International
Environmental Scan
the process of gathering information about the external environment to determine how it may potentially impact the business’s operations.
Economic System
combination of policies, laws, and choices made by government.
Factors of Production
the resources used to create goods and services, including natural resources, capital, labour, entrepreneurship, and knowledge.
Categories of Economic Systems
- Command
- Socialism
- Mixed
- Market
Degrees of Competition
- Perfect Competition: agricultural
- Monopolistic Competition: clothing
- Oligopoly: automobiles
- Monopoly: software protected by copyright
Health of the country’s economy can affect:
- Individuals
○ Financing to continue education
○ Ability to get a job
○ Amount of interest paid for credit card purchases, etc. - Businesses
○ Hiring employees
○ Investing in new manufacturing plants and equipment
○ Launching new products or services / moving into new markets - Government
○ Level of taxes collected -> budgets
○ Fiscal Policy -> either change levels of taxation and spending
○ Monetary Policy -> make changes to money supply or the interest rates to influence the economy
The Business Cycle
- Recession: two or more consecutive three-months period of decline in a country’s GDP
- Depression: severe form of recession over a longer period of time
- Trough: when a country’s economy bottoms out
Gross Domestic Product (GDP)
total dollar value of all goods and services produced by all people within the boundaries of a country during a one-year period.
Consumer Price Index (CPI):
monthly index that measures the changes in the prices of a fixed basket of goods and services purchased by a typical consumer in an urban area.
Factors of Production
the resources used to create goods and services, including natural resources, capital, labour, entrepreneurship, and knowledge
