Economics Flashcards
Identify the impact of small business/entrepreneurship on market economies.
Fosters entrepreneurship, leading to more innovation and competition
Explain the concept of private enterprise.
Private ownership of businesses. Increases competition and innovation.
Types of Costs
Direct, Indirect, Fixed, Variable, Operational
Define Fixed Cost
Costs that don’t change
Define Variable cost
Costs that vary with production
Define Direct cost
Direct costs to produce/sell
Define Indirect cost
Expenses that aren’t directly related to production
Define Operational cost
Expenses for daily operations
Examples of Internal Factors of Business Risk
Pricing
Employees
Vendors
Technological factors
Physical equipment Malfunctions
Examples of External Factors of Business Risk
Economy
Competition
Natural causes
Political factors
Explain the concept of competition.
Rivalry between companies, over a shared resource, that sell similar products and services
Determine the relationship between government and business.
Government shapes business activities with taxes, regulations, laws, subsidies, etc.
Describe the nature of taxes.
Used fund government services, and speed/slow economic growth
Describe the concept of economies of scale.
Reduced costs per unit that arise from increased total output
more output = cheaper CPU
