Review Flashcards
(168 cards)
1
Q
Aggregate Output
A
The total quantity of goods and services produced by an economic system during a given period. Primary measure of growth in the business cycle.
2
Q
Balance of Trade
A
The economic value of all the products a country exports minus the economic value of its imported products. A positive balance of trade is when a country exports more than it imports, negative balance of trade is when they import more than they export.
3
Q
Business
A
Organizations that provide goods and services that are then sold to earn profits.
4
Q
Capital
A
The financial resources needed to operate a business
5
Q
Capitalism
A
System that sanctions the private ownership of the factors of production and encourages entrepreneurship by offering profits as an incentive
6
Q
Communism
A
A system in which the government owns and operates all factors of production.
7
Q
Competition
A
When two or more businesses vie for the same resources or customer.
8
Q
Consumer Price Index (CPI)
A
A measure of the prices of typical products purchased by consumers living in urban areas.
9
Q
Demand
A
The willingness and ability of buyers to purchase a product (good or service)
10
Q
Demand and Supply Schedule
A
Assessment of the relationships among different levels of demand and supply at different price levels.
11
Q
Demand Curve
A
Shows how many products will be demanded (bought) at different prices.
12
Q
Depression
A
A prolonged and deep recession
13
Q
Domestic Business Environment
A
The environment in which a firm conducts its operations and derives it revenues.
14
Q
Economic Environment
A
Relevant conditions that exist in the economic system in which a company operates.
15
Q
Economic Indicator
A
A statistic that helps assess the performance of an economy.
16
Q
Economic System
A
A nation’s system for allocating its resources among its citizens.
17
Q
Entrepreneur
A
Business person who accepts both the risks and the opportunities involved in creating and operating a new business venture.
18
Q
External Environment
A
Everything outside an organization’s boundaries that might affect it.
19
Q
Factors of Production
A
Resources used in the production of goods and services labor, capital, entrepreneurs, physical resources and information resources.
20
Q
Fiscal Policies
A
Policies used by a government regarding how it collects and spends revenue.
21
Q
Global Business Environment
A
The international forces that affect a business.
22
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
23
Q
GDP Per Capita
A
GDP divided by total population
24
Q
Gross National Product (GNP)
A
Total value of all goods and services produced by a national economy within a given period regardless of where factors of production are located.
25
Inflation
Occurs when widespread price increases occur throughout an economic system.
26
Information Resources
Data and other information used by businesses.
27
Labor (Human Resources)
Physical and mental capabilities of people as they contribute to economic production.
28
Law of Demand
Principle that buyers will purchase (demand) more of a product as its price drops and less as its price increases.
29
Law of Supply
Principle that producers will offer (supply) more of a product for sale as its price rises and less as its price drops.
30
Market
Mechanism for exchange between buyers and sellers of a particular good or service.
31
Market Economy
Economy in which individuals control production and allocation decisions through supply and demand.
32
Market Price (equilibrium price)
Profit-maximizing price at which the quantity of goods demanded and the quantity of goods supplied are equal.
33
Mixed Market Economy
Economic system featuring characteristics of both planned and market economies.
34
Monetary Policies
Policies used by a govt to control the size of its money supply.
35
Monopolistic Competition
Market or industry characterized by numerous buyers and relatively numerous sellers trying to differentiate their product from those of competitors
36
Monopoly
Market or industry in which there is only one producer that can therefore set the prices of its products
37
National Debt
The amount of money the government owes its creditors
38
Natural Monopoly
Industry in which one company can most efficiently supply all needed goods and services.
39
Nominal GDP
GDP measured in current dollars or with all components valued at current prices
40
Oligopoly
Market or industry characterized by a handful of sellers with the power to influence the prices of their product.
41
Perfect Competition
Market or industry characterized by numerous small firms producing an identical product.
42
Physical Resources
Tangible items that organizations use in the conduct of their businesses.
43
Planned Economy
Economy that relies on a centralized govt to control all or most factors of production and to make all or most production and allocation decisions.
44
Political-Legal Environment
The relationship between business and government, usually in the form of government regulation of business.
45
Private Enterprise
Economic system that allows individuals to pursue their own interests without undue governmental restriction.
46
Privatization
Process of converting government enterprises into privately owned companies
47
Productivity
A measure of economic growth that compares how much a system produces with the resources needed to produce it.
48
Profits
Difference between a business's revenue and its expenses.
49
Purchasing Power Parity
The principle that exchange rates are set so that the prices of simliar products in different countries are about the same.
50
Real GDP
GDP adjusted to account for changes in currency values and price changes
51
Recession
A period during which aggregate output, as measured by GDP, declines
52
Shortage
Situation in which quantity demanded exceeds quantity supplied
53
Socialism
Planned economic system in which the government owns and operates only selected major sources of production.
54
Sociocultural environment
The customs, mores, values, and demographic characteristics of the society in which an organization functions.
55
Stability
Condition in which the amount of money available in an economic system and the quantity of goods and services produced in it are growing at about the same rate.
56
Stabilization Policy
Government economic policy intended to smooth out fluctuations in output and unemployment and to stabilize prices.
57
Standard of Living
The total quantity and quality of goods and services people can purchase with the currency used in their economic system.
58
Supply
The willingness and ability of producers to offer a good or service for sale.
59
Supply Curve
Graph showing how many units of a product will be supplied at different prices.
60
Surplus
Situation in which quantity supplied exceeds quantity demanded.
61
Technological environment
All the ways by which firms create value for their constituents.
62
Unemployment
The level of joblessness among people actively seeking work in an economic system.
63
Accommodative Stance
Approach to social responsibility by which a company, if specially asked to do so, exceeds legal minimums in its commitments to groups and individuals in its social environment.
64
Business Ethics
Ethical or unethical behaviors by employees in the context of their jobs.
65
Collusion
illegal agreement between two or more companies to commit a wrongful act.
66
Consumerism
Form of social activism dedicated to protecting the rights of consumers in their dealings with businesses.
67
Corporate Social Audit
Systematic analysis of a firm's overall attitude toward growth and the way it will manage it businesses or product lines.
68
Defensive Stance
Approach to social responsibility by which a company meets only minimum legal requirements in its commitments to groups and individuals.
69
Ethical Behavior
Behavior conforming to generally accepted social norms concerning beneficial and harmful actions.
70
Ethical Compliance
The extent to which the members of the organization follow basic ethical (and legal) standards of behavior.
71
Ethics
Beliefs about what is right and wrong or good and bad in actions that affect others.
72
Insider Trading
illegal practice of using special knowledge about a firm for profit or gain.
73
Legal compliance
The extent to which the organization conforms to local, state, federal, and international laws.
74
Lobbying
The use of persons or groups to formally represent an organization or group of organizations before political bodies.
75
Managerial Ethics
Standards of behavior that guide individual managers in their work.
76
Obstructionist Stance
Approach to social responsibility that involves doing as little as possible and may involve attempts to deny or cover up violations.
77
Organizational Stakeholders
Those groups, individuals, and organizations that are directly affected by the practices of an organization and who therefore have a stake in its performance.
78
Philanthropic Giving
The awarding of funds or gifts to charities or other worthy causes.
79
Political Action Committees
Special organizations created to solicit money and then distribute it to political candidates.
80
Proactive Stance
Approach to social responsibility by which a company actively seeks opportunities to contribute to the well-being of groups and individuals in its social environment.
81
Regulation
The establishment of law and rules that dictate what organizations can and cannot do.
82
Social Responsibility
The attempt of a business to balance its commitments to groups and individuals in its environment, including customers, other businesses, employees, investors, and local communities.
83
Unethical Behavior
Behavior that does not conform to generally accepted social norms concerning beneficial and harmful actions,
84
Whistle-Blower
Employee who detects and tries to put an end to a company's unethical, illegal, or socially irresponsible actions by publicizing them.
85
Acquisition
The purchase of one company by another.
86
Board of Directors
Governing body of a corporation that reports to its shareholders and delegates power to run its day-to-day operations while remaining responsible for sustaining its assets.
87
Business Plan
Document in which the entrepreneur summarizes his or her business strategy for the proposed new venture and how the strategy will be implemented.
88
Chief Executive Officer (CEO)
Top manager who is responsible for the overall performance of a corporation.
89
Closely Held (or private) Corporation
Corporation whose stock is held by only a few people and is not available for sale to the general public.
90
Cooperative
Form of ownership in which a group of sole proprietorships or partnerships agree to work together for common benefits.
91
Corporate Goverance
Roles of shareholders, directors, and other managers in corporate decision making and accountability.
92
Corporation
Business that is legally considered an entity separate from its owners and is liable for its own debts; owners' liability extends to the limits of their investments.
93
Divestiture
Strategy whereby a firm sells one or more of its business units.
94
Double Taxation
Situation in which taxes may be payable both by a corporation on its profits and by shareholders on dividend incomes.
95
Employee Stock Ownership Plan (ESOP)
Arrangement in which a corporation holds its own stock in trust for its employees, who gradually receive ownership of the stock and control its voting rights.
96
Entrepreneur
Business person who accepts both the risks and opportunities involved in creating/operating a new business venture.
97
Entrepreneurship
The process of seeking business opportunities under conditions of risk.
98
Established Market
One in which many firms compete according to relatively well-defined criteria.
99
First-Mover Advantage
Any advantage that comes to a firm because it exploits an opportunity before any other firm does.
100
Franchise
Arrangement in which a buyer (franchisee) purchases the right to sell the good or service of the seller (franchiser).
101
General (or active) partner
Partner who actively manages a firm and who has unlimited liability for its debts
102
General Partnership
Business with two or more owners who share in both the operation of the firm and the financial responsibilities for its debts.
103
Institutional Investor
Large investor, such as a mutual fund or a pension fund, that purchases large blocks of corporate stock.
104
Joint Venture
Strategic alliance in which the collaboration involves joint ownership of the new venture.
105
Limited Liability
Legal principle holding investors liable for a firm's debts only to the limits of their personal investments in it.
106
Limited Liability Corporation (LLC)
Hybrid of a publicly held corporation and a partnership in which owners are taxed as partners but enjoy the benefits of limited liability.
107
Limited partner
Partner who does not share in a firm's management and is liable only to the limits of said partner's investment.
108
Limited Partnership
Type of partnership consisting of limited partners and a general partner.
109
Master Limited Partnership
Form of ownership that sells shares to investors who receive profits and that pay taxes on income from profits.
110
Merger
The union of two corporations to form a new corporation,
111
Multinational (transnational) Corporation
Form of corporation spanning national boundaries
112
Niche
A segment of a market that is not currently being exploited.
113
Officers
Top management team of a corporation
114
Professional Corporation
Form of ownership allowing professionals to take advantage of corporate benefits while granting them limited business liability and unlimited professional liability.
115
Publicly Held (Public) Corporation
Corporation whose stock is widely held and available for sale to the general public.
116
S Corporation
Hybrid of a closely held corporation and a partnership, organized and operated like a corporation but treated as a partnership for tax purposes.
117
Small Business
Independently owned business that has relatively little influence in its market.
118
Small Business Administration (SBA)
Government agency charged with assisting small businesses.
119
Small Business Development Center (SBDC)
SBA program designed to consolidate information from various disciplines and make it available to small businesses.
120
Small Business Investment Company (SBIC)
Govt regulated investment company that borrows money from the SBA to invest in or lend to a small business.
121
Sole Proprietorship
Business owned and usually operated by one person who is responsible for all of its debts.
122
Spin-off
Strategy of setting up one or more corporate units as new, independent corporations.
123
Stockholder (or shareholder)
Owner of shares of stock in a corporation.
124
Strategic Alliance
Arrangement (also called joint venture) in which a company finds a foreign partner to contribute approximately half of the resources needed to establish and operate a new business in the partner's country.
125
Tender Offer
Offer to buy shares made by a prospective buyer directly to target corporation's shareholders, who then make individual decisions about whether to sell.
126
Unlimited Liability
Legal principle holding owners responsible for paying off all debts of a business.
127
Venture Capital Company
Group of small investors who invest money in companies with rapid growth potential
128
Absolute Advantage
The ability to produce something more efficiently than any other country can.
129
Association of Southeast Asian Nations (ASEAN)
Organization for economic, political, social, and cultural cooperation among Southeast Asian nations.
130
Balance of Payments
Flow of all money into or out of a country.
131
Balance of Trade
The economic value of all the products that a country exports minus the economic value of all products it imports.
132
Branch Office
Foreign office set up by an international or multinational firm.
133
Business Practice law
Law or regulation governing business practices in given countries.
134
Cartel
Association of producers whose purpose is to control supply and prices.
135
Comparative Advantage
The ability to produce some products more efficiently than others.
136
Dumping
Practice of selling a product abroad for less than the cost of production.
137
Embargo
Government order banning exportation or importation of a particular product or all products from a particular country.
138
Euro
A common currency in the EU (excluding Denmark, Sweden, UK).
139
European Union (EU)
Agreement among major European nations to eliminate or make uniform most trade barriers affecting group members.
140
Exchange Rate
Rate at which the currency of one nation can be exchanged for the currency of another nation
141
Export
Product made or grown domestically but shipped and sold abroad
142
Exporter
Firm that distributes and sells products to one or more foreign countries
143
Foreign Direct Investment (FDI)
Arrangement in which a firm buys or establishes tangible assets in another country.
144
General Agreement on Tariffs and Trade (GATT)
International trade agreement to encourage the multilateral reduction or elimination of trade barriers.
145
Globalization
Process by which the global economy is becoming a single interdependent system.
146
Goal Orientation
The manner in which people are motivated to work towards different types of goals.
147
Import
Product made abroad but sold domestically.
148
Importer
Firm that buys products in foreign markets and then imports them for resale in his home country.
149
Independent Agent
Foreign individual or organization that agrees to represent an exporter's interests
150
International Firm
Firm that conducts a significant portion of its business in foreign countries.
151
Licensing Arrangement
Arrangement in which firms choose foreign individuals or organizations to manufacture or market their products in another country.
152
Local Content Law
Law requiring that products sold in a particular country be at least partly made there.
153
Multinational Firm
Firm that designs, produces and markets products in multiple nations.
154
National Competitive Advantage
International competitive advantage stemming from a combination of factor conditions, demand conditions, related and supporting industries, and firm strategies, structures, and rivalries.
155
North American Free Trade Agreement (NAFTA)
Agreement to gradually eliminate tariffs and other trade barriers among the United States, Canada, and Mexico.
156
Offshoring
The practice of outsourcing to other countries
157
Outsourcing
The practice of paying suppliers and distributors to perform certain business processes or to provided needed materials or services.
158
Power Orientation
The beliefs that people in a culture hold about the appropriateness of power and authority differences in hierarchies such as business organizations.
159
Protectionism
Practice of protecting domestic against foreign competition.
160
Quota
Restriction on the number of products of a certain type that can be imported into a country.
161
Social Orientation
A person's beliefs about the relative importance of the individual versus groups to which that person belongs.
162
Subsidy
govt payment to help a domestic business compete with foreign firms.
163
Tariff
tax levied on imported products
164
Time Orientation
The extent to which members of a culture a long-term versus a short-term outlook on work, life, and other elements of society.
165
Trade Defecit
Situation in which a country's imports exceed its exports
166
Trade Surplus
Situation in which a country's exports exceed its imports
167
Uncertainty Orientation
The feeling individuals have regarding uncertain and ambiguous situations
168
World Trade Organization (WTO)
Organization through which member nations negotiate trading agreements and resolve disputes about trade policies and practices
