Midterm Flashcards
(38 cards)
Internal vs. External Stakeholders
Internal includes employees, investors and customers
External includes suppliers, govn’t, and the community
Economics
The study of how resources are distributed for the production of goods and services within a social system.
The Factors of Production
Natural, human and financial resources
Business under Communism
Business ownership- most businesses owned & operated by gov’nt
Competition- gov’nt controls competition & economy
Profits- Excess income goes to gov’nt
Product availability & price- Consumers have limited options. Prices are high.
Employment Options- Little choice in choosing career: Gov’nt owned industries or farms.
Business under Socialism
Business Ownership- The gov’nt owns & operates major industries; encouraged in small business.
Competition- Restricted in major industries; encouraged in small business.
Profits- Profits from small businesses is reinvested, profits from gov’nt owned industries goes to gov’nt.
Product Availability & Price- Consumers have some choice. Prices determined by supply & demand.
Employment Options- More career choices, many work in government jobs.
Business under Capitalism
Business ownership- individuals own and operate all businesses
Competition- increased by market forces and government regulations
Profits-individuals and businesses are free to keep profits after paying taxes
product availability and price - consumers have wide choice, price based on supply and demand
Employment options – unlimited choice of careers
The Rights for Free Enterprise
(1) The right to own property
(2) The right to earn profits
(3) The right to make decisions
(4) The right to Freedom of Choice.
Equilibrium Price=
Supply of goods matches demand
4 Market Structures
Pure Competition- Standardized product, many firms. Example: apples
Monopolistic Competition- Differentiated product, several firms , example: cheerios
Monopoly- Standardized or differentiated product, one firm , example: Microsoft
Oligopoly- Specialized product, few firms. Example: OPEC
Inflation
A continuing rise in prices
Recession
A decline in production, employment and income
GDP
Gross domestic product: the sum of all goods and services produced in a country in one year
Open Economy
An economy in which economic activities occur between the country and the international community.
Big Data
Refers to large volumes of structured and unstructured data that is transmitted at very fast speeds
Blockchain
A decentralized record-keeping technology that stores linked blocks of order transactions over time.
CPI
Consumer Price Index represents changes in prices by comparing, over time, the cost of a fixed basket of goods and services
How do we evaluate our nation’s economy?
-Trade Balance
-Consumer Price Index
-Per Capita Income
-Unemployment rate
-Inflation
-Worker Productivity
(Ch. 2) Business Ethics
Social Responsibility
Business ethics- principles and standards that determine acceptable conduct
Social Responsibility- a business’s obligation to maximize its positive impact
Many ethical issues are a result of…
-Abusive & intimidating behaviour
-Conflict of Interest
-Fairness and Honesty
-Communications
-Business Relationships
Ethical decisions in an organization are influenced by (3) factors:
-individual moral standards
-Influence of managers & coworkers
- the opportunity to engage in misconduct
4 Dimensions of Social Responsibility:
-Voluntary Responsibility
-Ethical Responsibility
-Legal responsibility
-Economic Responsibility
Corporate citizenship
The extent to which businesses meet the legal, ethical, economic, and voluntary responsibilities placed on them by their various stakeholders.
A business must be socially responsible to…
-Owners & stakeholders
-Employee Relations
-Consumer Relations
-Community
Consumers have the right to…
Be heard
Be informed
Able to choose
