Econ, Org., Ops., IT

Question 1

Microeconomics

Answer 1

Studies human choices and resource allocation.

Question 2

Demand

Answer 2

Demand refers to the willingness and ability of buyers to purchase goods and services at different prices. Demand is driven by a number of factors that influence how people decide to spend their money, including price and consumer preferences, and household income. It may also be driven by outside circumstances or larger economic events.

Question 3

Supply

Answer 3

supply is the amount of goods and services for sale at different prices.

Question 4

Demand Curve

Answer 4

demand curve is a graph of the amount of a product that buyers will purchase at different prices. Demand curves typically slope downward, meaning that buyers will purchase greater quantities of a good or service as its price falls.

Question 5

Supply Curve

Answer 5

A supply curve shows the relationship between different prices and the quantities that sellers will supply or offer for sale, regardless of demand. As price increases, other things constant, a producer becomes more willing and able to supply the good. Movement along the supply curve is the opposite of movement along the demand curve.

Question 6

Equilibrium price

Answer 6

The point where the two curves meet identifies the equilibrium price, the prevailing market price at which you can buy an item or the price toward which a good or service will trend. If the actual market price differs from the equilibrium price, buyers and sellers tend to make economic choices that restore the equilibrium level. Disequilibrium results in either a surplus or shortage.

Question 7

Macroeconomics

Answer 7

Macroeconomics is the study of a country’s overall economic issues. Macroeconomic topics usually relate topics to be discussed—output, unemployment, and inflation. Macroeconomics refers to the performance, structure, behavior, and decision making of an economy as a whole. Each nation’s policies and choices help determine its economic system.

Question 8

4 Types of Competition in Private Enterprise System

Answer 8

pure competition,
monopolistic competition,
oligopoly,
monopoly.

Question 9

Pure competition

Answer 9

A market structure in which large numbers of buyers and sellers exchange homogeneous products and no single participant has a significant influence on price. Instead, prices are set by the market as the forces of supply and demand interact. Firms can easily enter or leave a purely competitive market because no single company dominates. Buyers see little difference between the goods and services offered by competitors.

Question 10

Monopolistic competition

Answer 10

A market structure, like that for retailing, in which large numbers of buyers and sellers exchange differentiated (heterogeneous) products, so each participant has some control over price.

Question 11

Oligopoly

Answer 11

A market structure in which relatively few sellers compete and high start-up costs form barriers to keep out new competitors. Competing products in an oligopoly usually sell for very similar prices because substantial price competition would reduce profits for all firms in the industry.

Question 12

Monopoly

Answer 12

A single supplier in a market - occurs when a firm possesses unique characteristics so important to competition in its industry that they form barriers to prevent entry by would-be competitors.

Question 13

Regulated monopolies

Answer 13

Local, state, or federal government grants exclusive rights in a certain market to a single firm. Pricing decisions—particularly rate-increase requests—are subject to control by regulatory authorities such as state public service commissions.

Question 14

planned economy

Answer 14

government controls determine business ownership, profits, and resource allocation to accomplish government goals rather than those set by individual firms. Two forms of planned economies are communism and socialism.

Question 15

Socialism

Answer 15

Characterized by government ownership and operation of major industries such as communications. Allows private ownership in industries considered less crucial to social welfare, such as retail shops, restaurants, and certain types of manufacturing facilities.

Question 16

Communism

Answer 16

In which all property would be shared equally by the people of a community under the direction of a strong central government. Central government owns the means of production, and the people work for state-owned enterprises; determines what people can buy because it dictates what is produced in the nation’s factories and farms.

Question 17

mixed market economies

Answer 17

economic systems that draw from both types of economies, to different degrees. The proportions of private and public enterprise can vary widely in mixed economies, and the mix frequently changes.

Question 18

Privatization

Answer 18

Conversion of government-owned and operated companies into privately held businesses. Governments may privatize state-owned enterprises in an effort to raise funds and improve their economies. The objective is to cut costs and run the operation more efficiently.

Question 19

Business Cycle Stages

Answer 19

prosperity, recession, depression, and recovery.
A business cycle is a cycle of fluctuation in the long-term natural growth rate of Gross Domestic Product (GDP).

Question 20

Recession (Business Cycle)

Answer 20

a cyclical economic contraction that lasts for six months or longer—­consumers frequently postpone major purchases and shift buying patterns toward basic, ­functional products carrying low prices. Businesses mirror these changes in the marketplace by slowing production, postponing expansion plans, reducing inventories, and often cutting the size of their workforce.

Question 21

Recovery (Business Cycle)

Answer 21

In the recovery stage of the business cycle, the economy emerges from recession and consumer spending picks up steam. The economy experiences high levels of growth in gross domestic product, employment, output levels, and corporate profits.

Question 22

Depression (Business Cycle)

Answer 22

If an economic slowdown continues in a downward spiral over an extended period of time, the economy falls into depression.

Question 23

Prosperity (Business Cycle)

Answer 23

unemployment remains low, consumer confidence about the future leads to more purchases, and businesses expand—by hiring more employees, investing in new technology, and making similar purchases—to take advantage of new opportunities.

Question 24

Productivity

Answer 24

the relationship between the goods and services produced in a nation each year and the inputs needed to produce them. In general, as productivity rises, so does an economy’s growth and the wealth of its citizens. In a recession, productivity stalls or even declines. Describes the relationship between the number of units produced and the number of human and other production inputs necessary to produce them.

Question 25

Productivity (ratio)

Answer 25

Total productivity considers all inputs necessary to produce a specific amount of outputs. Stated in equation form, it can be written as follows: Total Productivity = Output (goods or services produced) / Input (human/natural resources, capital)

Question 26

Gross Domestic Product (GDP)

Answer 26

the sum of all goods and services produced within its boundaries. The GDP is based on the per-capita output of a country—in other words, total national output divided by the number of citizens.

Question 27

Inflation

Answer 27

rising prices caused by a combination of excess consumer demand and increases in the costs of raw materials, component parts, human resources, and other factors of production. Excess consumer demand generates what is known as demand-pull inflation whereas increases in the costs of factors of production generate cost-push inflation. Devalues money as persistent price increases reduce the amount of goods and services people can purchase with a given amount of money.

Question 28

Core Inflation

Answer 28

the inflation rate of an economy after energy and food prices are removed.

Question 29

Deflation

Answer 29

occurs when prices continue to fall - when the inflation rate falls below 0%, also called a negative inflation rate.

Question 30

Consumer Price Index (CPI)

Answer 30

measures the monthly average change in prices of goods and services.

Question 31

Producer Price Index (PPI)

Answer 31

the average change over time of prices of goods and services received by domestic producers.

Question 32

Unemployment Rate

Answer 32

Usually expressed as a percentage of the total workforce actively seeking work but currently unemployed. The total labor force includes all people who are willing and available to work at the going market wage, whether they currently have jobs or are seeking work.

Question 33

Frictional unemployment

Answer 33

experienced by members of the workforce who are temporarily not working but are looking for jobs. (New graduates, those who left jobs and looking, former workers returning to labor force.)

Question 34

Seasonal unemployment

Answer 34

joblessness of people in a seasonal industry. Construction workers, farm laborers, fishing boat operators, and landscape employees may contend with bouts of seasonal unemployment when conditions make work unavailable.

Question 35

Cyclical unemployment

Answer 35

people who are out of work because of a cyclical contraction in the economy.

Question 36

Structural unemployment

Answer 36

applies to people who remain unemployed for long periods of time, often with little hope of finding new jobs like their old ones. This situation may arise because these workers lack the necessary skills for available jobs or because the skills they have are no longer in demand.

Question 37

Monetary Policy

Answer 37

government actions to increase or decrease the money supply and change banking requirements and interest rates to influence spending by altering bankers' willingness to make loans.

Question 38

Expansionary Monetary Policy

Answer 38

increases the money supply in an effort to cut the cost of borrowing, which encourages business ­decision makers to make new investments, in turn stimulating employment and economic growth.

Question 39

Restrictive (Contractionary) Monetary Policy

Answer 39

reduces the money supply to curb rising prices, over expansion, and concerns about overly rapid economic growth. This is accomplished by increasing interest rates.

Question 40

Fiscal Policy

Answer 40

government spending and taxation decisions designed to control inflation, reduce unemployment, improve the general welfare of citizens, and encourage economic growth.

Question 41

Budget Deficit

Answer 41

When the government spends more than the amount of money it raises through taxes. To cover the deficit, the U.S. government borrows money by selling Treasury bills, Treasury notes, and Treasury bonds to investors. All of this borrowing makes up the national debt.

Question 42

Budget Surplus

Answer 42

excess funding that occurs when government spends less than the amount of funds raised through taxes and fees.

Question 43

Global Economic Challenges

Answer 43

(1) asset bubbles in a major economy, (2) deflation in a major economy, (3) failure of a major financial mechanism or institution, (4) failure/shortfall of critical ­infrastructure, (5) fiscal crises in key economies, (6) high structural unemployment or underemployment, (7) Illicit trade, (8) Trade tensions, (9) Energy price shock, (10) Unmanageable Inflation.

Question 44

Management

Answer 44

the process of achieving organizational objectives through people and other resources. The manager's job is to combine human and technical resources in the best way possible to achieve the company's goals.

Question 45

3 Levels of Management

Answer 45

top. middle, and supervisory (first-line)

Question 46

Top Management

Answer 46

Top managers devote most of their time to developing long-range plans for their organizations. Make decisions such as whether to introduce new products, purchase other companies, or enter new geographical markets. Set a direction for their organization and inspire the company's executives and employees to achieve their vision for the company's future.

Question 47

Middle Management

Answer 47

Middle managers' attention focuses on specific operations, products, or customer groups within an organization. Responsible for developing detailed plans and procedures to implement the company's strategic plans.

Question 48

Supervisory Management

Answer 48

includes positions such as supervisor, section chief, and team leader. Directly responsible for assigning non-managerial employees to specific jobs and evaluating their performance. Work directly with the employees who produce and sell the company's goods and services. Responsible for implementing middle managers' plans by motivating workers to accomplish daily, weekly, and monthly goals.

Question 49

3 Basic Types of Skills for Managers

Answer 49

technical, human, and conceptual

Question 50

Technical skills (for Managers)

Answer 50

Manager's ability to understand and use the techniques, knowledge, tools, and equipment of a specific discipline or department. Especially important for first-line managers and become less important at higher levels of the management hierarchy.

Question 51

Human skills (for Managers)

Answer 51

Include the ability to communicate, build rapport, collaborate, motivate, and lead employees to meet organizational goals through individual and team assignments. Might also include emotional intelligence, the ability to understand and manage one's own emotions, along with the emotions of others.

Question 52

Conceptual skills (for Managers)

Answer 52

determine a manager's ability to see the organization as a unified whole and to understand how each part of the overall organization interacts with other parts. These skills involve an ability to understand abstract relationships, interpret information, develop ideas, and creatively solve problems.

Question 53

Managerial functions

Answer 53

1) planning, 2) organizing, 3) directing, and 4) controlling

Question 54

Planning

Answer 54

process of anticipating future events and conditions and determining courses of actions for achieving organizational objectives. Helps a business focus its vision, avoid costly mistakes, and seize opportunities. Should be flexible and responsive to changes in the business environment, and should involve managers from all levels of the organization.

Question 55

Organizing

Answer 55

process of blending human and material resources through a formal structure of tasks and authority; arranging work, dividing tasks among employees, and coordinating them to ensure implementation of plans and accomplishment of objectives. Involves classifying and dividing work into manageable units with a logical structure.

Question 56

Directing

Answer 56

guiding and motivating employees to accomplish organizational objectives. Directing might include training (or retraining), setting up schedules, delegating certain tasks, and monitoring progress.

Question 57

Controlling

Answer 57

evaluates an organization's performance against its objectives. Assesses the success of the planning function and provides feedback for future rounds of planning. The four basic steps in controlling are to establish performance standards, monitor actual performance, compare actual performance with established standards, and make corrections if necessary.

Question 58

Types of Planning

Answer 58

strategic, tactical, operational, and contingency, with each step including more specific information than the last.

Question 59

Strategic Planning

Answer 59

the process of determining the primary objectives of an organization and then acting and allocating resources to achieve those objectives. Generally, strategic planning is undertaken by top executives in a company.

Question 60

Tactical Planning

Answer 60

involves implementing the activities specified by strategic plans. Tactical plans guide the current and near-term activities required to implement interconnected retail strategies.

Question 61

Operational Planning

Answer 61

creates the detailed standards that guide implementation of tactical plans. This activity involves choosing specific work targets and assigning employees and teams to carry out plans. Unlike strategic planning, which focuses on the organization as a whole, operational planning deals with developing and implementing tactics in specific functional areas.

Question 62

Contingency Planning

Answer 62

plans that allow a firm to resume operations as quickly and as smoothly as possible after a crisis while openly communicating with the public about what happened. Usually designates a chain of command for crisis management, assigning specific functions to particular managers and employees in an emergency.

Question 63

Strategic Planning Process

Answer 63

1) defining a mission, 2) assessing the organization's competitive position, 3) setting organizational objectives, 4) creating strategies for competitive differentiation, 5) implementing the strategy, and 6) evaluating the results and refining the plan.

Question 64

Mission Statement

Answer 64

a written explanation of an organization's business intentions and aims. Guides the actions of employees and publicizes the company's reasons for existence.

Question 65

Assessing Competitive Position

Answer 65

A frequently used tool in this phase of strategic planning is the SWOT analysis. SWOT is an acronym for strengths, weaknesses, opportunities, and threats. By systematically evaluating all four of these factors, a company can then develop the best strategies for gaining a competitive advantage.

Question 66

Objectives

Answer 66

set guideposts by which managers define the organization's desired performance in such areas as new-product development, sales, customer service, growth, environmental and social responsibility, and employee satisfaction. While the mission statement identifies a company's overall goals, objectives are more concrete.

Question 67

Strategy for Competitive Differentiation

Answer 67

the unique combination of a company's abilities and resources that set it apart from its competitors.

Question 68

Monitoring/Adapting Strategic Plans

Answer 68

Monitoring involves securing feedback about performance. Managers might compare actual sales against forecasts; compile information from surveys; listen to customer feedback; interview employees who are involved; and review reports prepared by production, finance, marketing, or other company units. Ongoing use of such tools as SWOT analysis and forecasting can help managers adapt their objectives and functional plans as changes occur.

Question 69

Decision Making

Answer 69

the process of recognizing a problem or opportunity, evaluating alternative solutions, selecting and implementing an alternative, and assessing the results. Managers make two basic kinds of decisions: programmed decisions and non-programmed decisions.

Question 70

Programmed Decision

Answer 70

involves simple, common, and frequently occurring problems for which solutions have already been determined. Ex. reordering office supplies, renewing a lease, and referring to an established discount for bulk orders. Made in advance—the company sets rules, policies, and procedures for managers and employees to follow on a routine basis.

Question 71

Non-programmed Decision

Answer 71

involves a complex and unique problem or opportunity with important consequences for the organization. Ex. entering a new market, deleting a product from the line, or developing a new product.

Question 72

Steps in the Decision-Making Process

Answer 72

1) recognizes a problem or opportunity, 2) develops possible courses of action, 3) evaluates the alternatives, 4) selects and implements one of them, and 5) assesses the outcome.

Question 73

Leadership styles

Answer 73

autocratic, democratic, free-rein

Question 74

Corporate Culture

Answer 74

system of principles, beliefs, and values. The leadership style of its managers, the way it communicates, and the overall work environment influence a company's corporate culture. Typically shaped by the leaders who founded and developed the company and by those who have succeeded them. Managers use symbols, rituals, ceremonies, and stories to reinforce corporate culture.

Question 75

Organization

Answer 75

a structured group of people working together to achieve common goals. An organization features three key elements: human interaction, goal-directed activities, and structure.

Question 76

Organizing Process

Answer 76

Managers first determine the specific activities needed to implement plans and achieve goals. Next, they group these work activities into a logical structure. Then they assign work to specific employees and give the people the resources they need to complete it. Managers coordinate the work of different groups and employees within the company. Finally, they evaluate the results of the organizing process to ensure effective and efficient progress toward planned goals. Evaluation sometimes results in changes to the way work is organized.

Question 77

Departmentalization

Answer 77

process of dividing work activities into units within the organization. In this arrangement, employees specialize in certain jobs—such as marketing, finance, or design. Depending on the size of the company, usually a senior-level executive runs the department, followed by middle-level managers and supervisors. The five major forms of departmentalization subdivide work by product, geographical area, customer, function, and process.

Question 78

Span of Management

Answer 78

or span of control, is the number of employees a manager supervises. These employees are often referred to as direct reports. First-line managers have wider spans of management

Question 79

Centralization and Decentralization

Answer 79

A company that emphasizes centralization retains decision making at the top of the management hierarchy. A company that emphasizes decentralization locates decision making at lower levels. A trend toward decentralization has pushed decision making down to operating employees in many cases. Companies that have decentralized believe that the change can improve their ability to serve customers.

Question 80

Organizational Structure

Answer 80

line, line-and-staff, committee, and matrix. While some companies do follow one type of structure, most use a combination.

Question 81

Line Organizations

Answer 81

establishes a direct flow of authority from the chief executive to employees. The line organization defines a simple, clear chain of command—a hierarchy of managers and workers.

Question 82

Line-and-Staff Organizations

Answer 82

combines the direct flow of authority of a line organization with staff departments that support the line departments. Line departments participate directly in decisions that affect the core operations of the organization. Staff departments lend specialized technical support.

Question 83

Committee Organizations

Answer 83

structure that places authority and responsibility jointly in the hands of a group of individuals rather than a single manager. This model typically appears as part of a regular line-and-staff structure.

Question 84

Matrix Organizations

Answer 84

links employees from different parts of the organization to work together on specific projects. Popular at high-technology and multinational corporations, as well as hospitals and consulting firms.

Question 85

Utility

Answer 85

the want-satisfying power of a good or service. Businesses can create or enhance four basic kinds of utility: time, place, ownership, and form. A company's marketing operation generates time, place, and ownership utility by offering products to customers at a time and place that is convenient for purchase. Production creates form utility by converting raw materials and other inputs into finished products.

Question 86

Mass Production

Answer 86

system for manufacturing products in large quantities through effective combinations of employees with specialized skills, mechanization, and standardization. Mass production makes outputs (goods and services) available in large quantities at lower prices than individually crafted items would cost.

Question 87

Flexible Production

Answer 87

allows manufacturing equipment to be used for more than one purpose, is usually more cost-effective for producing smaller runs. Generally involves using information technology to share the details of customer orders, technology (sometimes robots) to fulfill the orders, and skilled people to carry out whatever tasks are needed to fill a particular order.

Question 88

Customer-Driven Production

Answer 88

evaluates customer demands in order to make the connection between products manufactured and products bought

Question 89

Production processes

Answer 89

Production processes use either an analytic or synthetic system; time requirements call for either a continuous or an intermittent process.

Question 90

analytic production system

Answer 90

reduces a raw material to its component parts in order to extract one or more marketable products.

Question 91

synthetic production system

Answer 91

reverse of an analytic system. It combines a number of raw materials or parts or transforms raw materials to produce finished products.

Question 92

continuous production process

Answer 92

generates finished products over a lengthy period of time.

Question 93

intermittent production process

Answer 93

generates products in short production runs, shutting down machines frequently or changing their configurations to produce different products.

Question 94

LEED (Leadership in Energy and Environmental Design)

Answer 94

voluntary certification program administered by the U.S. Green Building Council, aimed at promoting the most sustainable construction processes available.

Question 95

computer-aided design (CAD)

Answer 95

process that allows engineers to design components as well as entire products on computer screens faster and with fewer mistakes than they could achieve working with traditional drafting systems.

Question 96

computer-aided manufacturing (CAM)

Answer 96

computer tools to analyze CAD output and enable a manufacturer to analyze the steps that a machine must take to produce a needed product or part.

Question 97

flexible manufacturing system (FMS)

Answer 97

production facility that can be quickly modified to manufacture different products.

Question 98

Factors in the Location Decision

Answer 98

The decision of where to locate a production facility hinges on the concept of time-to-market, which includes transportation, human, and physical or infrastructure factors.

Question 99

Production and operations managers

Answer 99

oversee the work of people and technology to convert inputs (materials and resources) into finished goods and services. These managers perform four major tasks: 1. Plan the overall production process 2. Determine the best layout for the firm's facilities 3. Implement the production plan 4. Control the manufacturing process to maintain the highest possible quality

Question 100

Implementing the Production Plan

Answer 100

This activity involves (1) deciding whether to make, buy, or lease components; (2) selecting the best suppliers for materials; and (3) controlling inventory to keep enough, but not too much, on hand.

Question 101

Inventory Control

Answer 101

Production and operations managers' responsibility for inventory control requires them to balance the need to keep stock on hand to meet demand against the costs of carrying inventory. Among the expenses involved in storing inventory are warehousing costs, taxes, insurance, and maintenance.

Question 102

Production Control

Answer 102

creates a well-defined set of procedures for coordinating people, materials, and machinery to provide maximum production efficiency. Five-step process composed of planning, routing, scheduling, dispatching, and follow-up. These steps are part of a company's overall emphasis on total quality management.

Question 103

Production Planning (production control)

Answer 103

determines the amount of resources (including raw materials and other components) an organization needs to produce a certain output. The production planning process develops a bill of materials that lists all needed parts and materials.

Question 104

Routing (production control)

Answer 104

determines the sequence of work throughout the facility and specifies who will perform each aspect of the work at what location. Routing choices depend on two factors: the nature of the good or service and the facility layouts

Question 105

Scheduling (production control)

Answer 105

managers develop timetables that specify how long each operation in the production process takes and when workers should perform it. Efficient scheduling ensures that production will meet delivery schedules and make efficient use of resources.

Question 106

Scheduling Charts (production control)

Answer 106

Gantt chart, tracks projected and actual work progress over time. Best for simple projects. PERT (program evaluation and review technique) chart, which seeks to minimize delays by coordinating all aspects of the production process. For complex projects.

Question 107

Dispatching (production control)

Answer 107

management instructs each department on what work to do and the time allowed for its completion. The dispatcher authorizes performance, provides instructions, and lists job priorities.

Question 108

Follow-up (production control)

Answer 108

managers and employees or team members spot problems in the production process and come up with solutions.

Question 109

Benchmarking

Answer 109

determining how well other companies perform business functions or tasks. Process of comparing other firms' standards, performance metrics, and best practices, usually in terms of quality, costs, and time.

Question 110

Quality Control

Answer 110

measuring output against established quality standards. Companies need such checks to spot defective products and to avoid delivering inferior shipments to customers.

Question 111

ISO Standards

Answer 111

standards for everything from the format of banking and telephone cards to freight containers to paper sizes to metric screw threads. The U.S. member body of ISO is the American National Standards Institute (ANSI).