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Business Management > Midterm #1 > Flashcards

Midterm #1 Flashcards

1
Q

Business

A

An organization that seeks to earn profits by providing goods and services.

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2
Q

Profit

A

What remains (if anything) after a business expenses are subtracted from its sales revenues.

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3
Q

Not-for-profit Organization

A

An organization that provides goods and services to customers, but does not seek to make a profit while doing so.

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4
Q

Economic System

A

The way in which a nation allocates its resources among its citizens.

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5
Q

Factors of Production

A

The resources used o produce goods and services: labour, capital, entrepreneurs, and natural resources.

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6
Q

Command Economy

A

An economic system in which government controls all or most factors of production and makes all or most production decisions.

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7
Q

Market Economy

A

An economic system in which individuals control all or most factors of production and make all or most production decisions.

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8
Q

Communism

A

A type of command economy in which the government owns and operates all industries.

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9
Q

Market

A

An exchange process between buyers and sellers of a particular good or service.

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10
Q

Input Market

A

Firms buy resources that they need in the procedure of goods and services.

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11
Q

Output Market

A

Firms supple goods and services in response to demand on the part of consumers.

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12
Q

Capitalism

A

An economic system in which markets decide what, when, and for whom to produce.

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13
Q

Mixed Market Economy

A

An economic system with elements of both a command economy and a market economy; in practice, typical of most nations’ economies.

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14
Q

Privatization

A

The transfer of activities from the government to the private sector.

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15
Q

Deregulation

A

A reduction in the number of laws affecting business activity.

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16
Q

Competition Act

A

Prohibits a variety of business practices that lessen competition.

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17
Q

Lobbyist

A

A person hired by a company or an industry to represent its interests with government officials.

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18
Q

Trade Association

A

An organization dedicated to promoting the interests and assisting the members of a particular industry.

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19
Q

Demand

A

The willingness and ability of buyers to purchase a product or service.

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20
Q

Supply

A

The willingness and ability of producers to offer a good or service for sale.

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21
Q

Law of Demand

A

The principle that buyers will purchase (demand) more of a product as price rises.

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22
Q

Law of Supply

A

The principle that producers will offer (supply) more of a product as price rises.

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23
Q

Demand and Supply Schedule

A

Assessment of the relationships between different levels of demand and supply at different price levels.

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24
Q

Demand Curve

A

Graph showing how many units of a product will be demanded (bought) at different prices.

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25
Q

Supply Curve

A

Graph showing how many units of a product will be supplied (offered for sale) at different prices.

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26
Q

Market Price (Equilibrium price)

A

Profit-maximizing price at which the quantity of goods demanded and the quantity of goods supplied are equal.

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27
Q

Private Enterprise

A

An economic system characterized by private property rights, freedom of choice, profits, and competition.

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28
Q

Perfect Competition

A

A market or industry characterized by a very large number of small firms producing an identical product so that none of the firms has any ability to influence price.

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29
Q

Surplus

A

Situation in which quantity supplied exceeds quantity demanded.

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30
Q

Monopoly

A

A market or industry with only one producer, who can set the price of its product and/or resources.

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31
Q

External Environment

A

Everything outside an organization’s boundaries that might affect it.

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32
Q

Economic Environment

A

Conditions of the economic system in which an organization operates.

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33
Q

Aggregate Output

A

Total quantity of goods and services produced by an economic system during a given period.

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34
Q

Business Cycle

A

Pattern of short-term ups and downs (expansions and contractions) in an economy.

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35
Q

Gross Domestic Product (GDP)

A

Total value of all goods and services produced within a given period by a national economy through domestic factors of production.

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36
Q

Gross National Product (GNP)

A

Total value of all goods and services produced by a national economy within a given a period regardless of where the factors of production are located.

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37
Q

GDP Per Capita

A

Gross domestic product per person.

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38
Q

Real GDP

A

GDP calculated to account for changes in currency values and price changes.

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39
Q

Purchasing Power Parity

A

Principle that exchange rates are set so that the prices of similar products in different countries are about the same.

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40
Q

Productivity

A

Measure of economic growth that compares how much a system produces with the resources needed to produce it.

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41
Q

Balance of Trade

A

The total of a country’s exports (sales to other countries) minus its imports (purchases from other countries).

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42
Q

National Debt

A

The total amount of money that a country owes its creditors.

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43
Q

Budget Deficits

A

The result of the government spending more in one year than it takes in during that year.

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44
Q

Inflation

A

Occurrence of widespread price increases throughout an economic system.

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45
Q

Consumer Price Index (CPI)

A

Measure of the prices of typical products purchased by consumers living in urban areas.

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46
Q

Deflation

A

A period of generally falling prices.

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47
Q

Unemployment

A

The level of joblessness among people actively seeking work in an economic system.

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48
Q

Fiscal Policies

A

Policies whereby governments collect and spend revenues.

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49
Q

Monetary Polocies

A

Policies whereby the government controls the size of the nation’s money supply.

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50
Q

Research and Development (R&D)

A

Those activities that are necessary to provide new products, services, and processes.

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51
Q

Political-Legal Environment

A

Conditions reflecting the relationship between business and government, usually in the form of government regulation.

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52
Q

Socio-cultural Environment

A

Conditions including the customs, values, attitudes, and demographic characteristics of the society in which an organization functions.

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53
Q

Outsourcing

A

Strategy of paying suppliers and distributors to perform certain business processes or to provide needed materials or services.

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54
Q

Business Process Management

A

Approach by which firms move away from department-oriented organization and toward process-oriented team structures that cut across old departmental boundaries.

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55
Q

Acquisition

A

The purchase of a company by another, larger firm, which absorbs the smaller company into its operations.

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56
Q

Merger

A

The union of two companies to form a single new business.

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57
Q

Poison Pill

A

A defence management adopts to make a firm less attractive to an actual or potential hostile suitor in a takeover attempt.

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58
Q

Divestiture

A

Occurs when a company sells part of its existing business operations to another company.

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59
Q

Spinoff

A

Strategy of setting up one or more corporate units as new, independent corporations.

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60
Q

Strategic Alliance

A

An enterprise in which two or more persons or companies temporarily join forces to undertake a particular project.

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61
Q

Ethics

A

Individual standards or moral values regarding what is right and wrong or good and bad.

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62
Q

Business Ethics

A

Ethical or unethical behaviours by a manager or employee of an organization.

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63
Q

Managerial Ethics

A

Standards oh behaviour that guide individual managers in their work.

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64
Q

Conflict of Interest

A

Occurs when an activity benefits the employee at the expense of the employer.

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65
Q

Corporate Social Responsibility

A

The idea that a business should balance its a commitments to individuals and groups that are directly affected by the organization’s activities.

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66
Q

Fair-trade Movement

A

A movement designed to help workers in developing countries receive fair payments for their work.

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67
Q

Organizational Stakeholders

A

Groups, individuals, and organizations that are directly affected by the practices of an organization and that therefore have a stake in its performance.

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68
Q

Consumerism

A

A social movement that seeks to protect and expand the rights of consumers in their dealings with businesses.

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69
Q

Whistle-Blower

A

An individual who calls attention to an unethical, illegal, and/or socially irresponsible practice on the part of a business or other organization.

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70
Q

Insider Trading

A

The use of confidential information to gain from the purchase or sale of stock.

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71
Q

Pollution

A

The introduction of harmful substances into the environment.

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72
Q

Recycling

A

The reconversion of waste materials into useful products.

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73
Q

Sustainable Development

A

Activities that meet current needs, but will not put future generations at a disadvantage when they try to meet their needs.

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74
Q

Social Audit

A

A systematic analysis of how a firm is using funds earmarked for social-responsibility goals and how effective these expenditures have been.

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75
Q

Law

A

The set of rules and standards that a society agrees upon to govern the behaviour of its citizens.

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76
Q

Common Law

A

The unwritten law of England, derived from precedent and legal judgements.

77
Q

Statutory Law

A

Written law developed by city councils, provincial legislatures, and parliament.

78
Q

Administrative Law

A

The rules and regulations that government agencies and commissions develop based on their interpretations of statutory laws.

79
Q

Business Law

A

Laws that specifically affect how business firms are managed.

80
Q

Contract

A

An agreement between two parties to act in a specified way or to perform certain acts.

81
Q

Express Contract

A

Clearly specifies the terms of an agreement.

82
Q

Implied Contract

A

Specifies the necessary behaviours of the parties to the contract.

83
Q

Breach of Contract

A

When one party to an agreement fails, without legal reason, to live up to the agreement’s provisions.

84
Q

Agency-principle Relationship

A

Established when one party (the agent) is authorized to act on behalf of another party (the principal).

85
Q

Bailor-Bailee Relationship

A

In a bailor-bailee relationship, the bailor (the property owner) gives possession of his or her property to the bailee (a custodian) but retains ownership of the item.

86
Q

Property

A

Anything of tangible or intangible value that the owner has the right to possess and use.

87
Q

Real Property

A

Land and any permanent buildings attached to that land.

88
Q

Personal Property

A

Tangible or intangible assets other than real property.

89
Q

Deed

A

A document that shows ownerships of real property.

90
Q

Lease

A

Grants the use of an asset for a specified period of time in return for payment.

91
Q

Title

A

Shows legal possession of a personal property.

92
Q

Warranty

A

A promise that the product or service will perform as the seller has promised it will.

93
Q

Express Warranty

A

A specific claim that the manufacturer makes about a product.

94
Q

Implied Warranty

A

A suggestion that a product will perform as the manufacturer claims it will.

95
Q

Trademark

A

The exclusive legal right to use a brand name.

96
Q

Patent

A

Protects an invention or idea for a period of 20 years.

97
Q

Copyright

A

Exclusive ownership rights granted to creators for the tangible expression of an idea.

98
Q

Tort

A

A wrongful civil act that one party inflicts on another and that results in injury to the person’s property, or to the person’s good name.

99
Q

Intentional Tort

A

A wrongful act intentionally committed.

100
Q

Negligence

A

A wrongful act that inadvertently causes injury to another person.

101
Q

Product Liability

A

The liability of businesses for injuries caused to product users because of negligence in design or manufacturing.

102
Q

Strict Product Liability

A

The liability of businesses for injuries caused by their products even if their is no evidence of negligence in the design or manufacture of the product.

103
Q

Negotiable Instruments

A

Instruments like cheques, bank drafts, and certificates of deposit that can be transferred among individuals and business firms.

104
Q

Endorsement

A

Signing your name to a negotiable instrument, making it transferable to another person or organization.

105
Q

Bankruptcy

A

The court-granted permission for organizations or individuals to not pay some or all of their debts.

106
Q

Insolvent Person (or company)

A

One who cannot pay current obligations to creditors as they come due, or whose debts exceed their assets.

107
Q

Bankrupt Person (or company)

A

One who has either made a voluntary application to start bankruptcy proceedings (voluntary bankruptcy) or has been forced by creditors into bankruptcy (involuntary bankruptcy) by a process referred to as a receiving order.

108
Q

International Law

A

The very general set of co-operative agreements and guidelines established by countries to govern the actions of individuals, businesses, and nations themselves.

109
Q

Small Business

A

An independently owned and managed business that does not dominate its market.

110
Q

New Venture

A

A recently formed commercial organization that provides goods and/or services for sale.

111
Q

Entrepreneurship

A

The process of identifying an opportunity in the marketplace and accessing the resources needed to capitalize on it.

112
Q

Entrepreneur

A

A business person who accepts both the risks and opportunities involved in creating and operating a new business venture.

113
Q

Intrapreneurs

A

People who create something new within an existing large firm or organization.

114
Q

Private Sector

A

The part of the economy made up of companies and organizations not owned or controlled by the government.

115
Q

Sales Forecast

A

An estimate of how much of a product or service will be purchased by prospective customers over a specific period.

116
Q

Franchise

A

An arrangement that gives franchisees (buyers) the right to sell the product of the franchiser (the seller).

117
Q

Business Plan

A

Document in which the entrepreneur summarizes her or his business strategy for the preposed new venture and how that strategy will be implemented.

118
Q

Bootstrapping

A

Doing more with less.

119
Q

Collateral

A

Assets that a borrower uses to secure a loan or other credit, and that are subject to seizure by the lender if the loan isn’t repaid according to the specified repayment terms.

120
Q

Incubators

A

Facilities that support small businesses during their early growth phase by providing basic services, office space, legal advice, and more.

121
Q

Franchising Agreement

A

Stipulates the duties and responsibilities of the franchisee and the franchiser.

122
Q

Sole Proprietorship

A

Business owned and usually operated by one person who is responsible for all of its debt.

123
Q

Unlimited Liability

A

A person who invests in a business is liable for all debts incurred by the business; personal possessions can be taken to pay debts.

124
Q

Partnership

A

A business with two or more owners who share in the operation of the firm and in financial responsibility for the firm’s debts.

125
Q

General Partner

A

A partner who is actively involved in managing the firm and has unlimited liability.

126
Q

Limited Partner

A

A partner who generally does not participate actively in the business, and whose liability is limited to the amount invested in the partnership.

127
Q

Corporation

A

A business considered by law to be a legal entity separate from its owners with many of the legal rights and privileges of a person; a form of business organization in which the liability of the owners is limited to their investment in the firm.

128
Q

Shareholders

A

Investors who buy shares of ownership in the form of stock.

129
Q

Common Stock

A

Shares whose owners usually have last claim on the corporation’s assets (after creditors and owners of preferred stock) but who have voting rights in the firm.

130
Q

Board of Directors

A

A group of individuals elected by a firm’s shareholders and charged with overseeing, and taking legal responsibility for, the firm’s actions.

131
Q

Chief Executive Officer (CEO)

A

The highest-ranking executive in a company or organization.

132
Q

Public Corporation

A

A business whose stock is widely held and available for sale to the general public.

133
Q

Private Corporation

A

A business whose stock is held by a small group of individuals and is not usually available for sale to the general public.

134
Q

Initial Public Offering (IPO)

A

Selling shares of stock in a company for the first time to a general investing public.

135
Q

Private Equity Firms

A

Companies that buy publicly traded companies and then make them private.

136
Q

Income Trust

A

A structure allowing companies to avoid paying corporate income tax if they distribute all or most of their earnings to investors.

137
Q

Limited Liability

A

Investor liability is limited to their persona; investments in the corporation; courts cannot touch the personal assets of investors in the event that the corporation goes bankrupt.

138
Q

Stock

A

A share of ownership in a corporation.

139
Q

Double Taxation

A

A corporation must pay income taxes on its profits, and then shareholders must also pay personal income taxes on the dividends they receive from the corporation.

140
Q

Dividends

A

The amount of money, normally a portion of the profits that is distributed to the shareholders.

141
Q

Co-operative

A

An organization that is formed to benefit its owners in the form of reduced prices and/or the distribution of surpluses at year-end.

142
Q

Globalization

A

Process by which the world economy is becoming a single interdependent system.

143
Q

Import

A

Product made or grown abroad but sold domestically.

144
Q

Export

A

Product made or grown domestically but shipped and sold abroad.

145
Q

BRICS

A

A term denoting a group of 5 important and powerful emerging markets in the business world: Brazil, Russia, India, China, and South Africa.

146
Q

Absolute Advantage

A

The ability to produce something more efficiently than any other country.

147
Q

Comparative Advantage

A

The ability to produce some products more efficiently than others.

148
Q

National Competitive Advantage

A

International competitive advantage stemming from a combination of factor conditions; demand conditions; related and supporting industries; and firm strategies, structures, and rivalries.

149
Q

International Competitiveness

A

Competitive marketing of domestic products against foreign products.

150
Q

Balance of Trade

A

The economic value of all the products that a country exports minus the economic value of all the products it imports.

151
Q

Surplus

A

Situation in which country exports more than it imports, creating a favourable balance of trade.

152
Q

Deficit

A

Situation in which a country’s imports exceed its exports, creating a negative balance of trade.

153
Q

Balance of Payments

A

Flow of all money into or out of a country.

154
Q

Exchange Rate

A

Rate at which the currency of one nation can be exchanged for the currency of another notion.

155
Q

Euro

A

A common currency shared among most of the members of the European Union.

156
Q

Exporter

A

Firm that distributes and sells products to one or more foreign countries.

157
Q

Importer

A

Firm that buys products in foreign markets and then imports them for resale in its home country.

158
Q

International Firm

A

Firm that conducts a significant portion of its business in foreign countries.

159
Q

Multinational Firm

A

Firm that designs, produces, and markets products in many notions.

160
Q

Independent Agent

A

Foreign individual or organization that agrees to represent an exporter’s interests.

161
Q

Licensing Arrangement

A

Arrangement in which firms choose foreign individuals or organizations to manufacture or market their products in another country.

162
Q

Branch Office

A

A location that an exporting firm establishes in a foreign country to sell its products more effectively.

163
Q

Foreign Direct Investment (FDI)

A

Buying or establishing tangible assets in another country.

164
Q

Quota

A

A restriction by one nation on the total number of products of a certain type that can be imported from another nation.

165
Q

Embargo

A

A government order forbidding exportation and/or importation of a particular product.

166
Q

Tariff

A

A tax levied on imported products.

167
Q

Subsidy

A

A government payment to help domestic business compete with foreign firms.

168
Q

Protectionism

A

Protecting domestic business at the expense of free market competition.

169
Q

Local-Content Laws

A

Laws requiring that products sold in a particular country be at least partly made in that country.

170
Q

Business-Practice Law

A

Law or regulation governing business practices in given countries.

171
Q

Cartel

A

Any association of producers whose purpose is to control supply of and prices for a given product.

172
Q

Dumping

A

Selling a product for less abroad than in the producing nation.

173
Q

General Agreement on Tariffs and Trade (GATT)

A

International trade agreement to encourage the multilateral reduction or elimination of trade barriers.

174
Q

World Trade Organization (WTO)

A

Organization through which member nations negotiate trading agreements and resolve disputes about trade policies and practices.

175
Q

European Union (EU)

A

Agreement among major Western European nations to eliminate or make uniform most trade barriers affecting group members.

176
Q

North American Free Trade Agreement (NAFTA)

A

Agreement to gradually eliminate tariffs and other trade barriers among the United States, Canada, and Mexico.

177
Q

Systems Thinking

A

A model of decision-making that helps organizations effectively deal with change and adapt.

178
Q

Depression

A
  • Period of 2 or more years

- Great dust bowl (1930’s)

179
Q

Anthropocene

A

A period where the influence of humankind is omnipresent, and in most cases detrimental to the development of all living species on the planet.

180
Q

The 3 pillars of a social ecological system?

A
  • Fairness
  • Prosperity
  • Sustainability
181
Q

How government influences business

A

Government as…

  • a customer
  • a competitor
  • regulator
  • a taxation agent
  • a provider of incentives and financial assistance
  • a provider of essential services
182
Q

How business influences government

A

Lobbyist (a person hired by a company or an industry to represent its interests with government officials.)

183
Q

What is supply and demand as it relates to the Canadian market economy?

A
  • exchange process between buyers and sellers

- how much of what product a company offers for sale and who buys it depends on the laws of demand and supply

184
Q

How do you define research and development?

A
  • provides new ideas for products, services, and processes

- Basic vs. Applied

185
Q

What is the ethical and moral responsibility of business?

A
  1. Demonstrate top management commitment to values and high ethical standards
  2. Adopt written code of ethics
  3. Provide ethics training
186
Q

What does ethics mean?

A
  • Individual standards or moral values regarding what is right and wrong or good and bad
187
Q

When a company strives to be socially responsible what do they focus on?

A
  1. customers
  2. employees
  3. investors
  4. suppliers
  5. communities
188
Q

Social Capital

A

Networks together with shared norms, values and understandings that facilitate co-operation within or among groups.

189
Q

Important actions for entrepreneurs

A
  1. Identify opportunity

2. Access resources

Business Management (2 decks)

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