Business Ch 1

The study of the economy as a whole

Macro

Pure Monopoly

a market structure where one company is the single source for a product and there are no close substitutes for the product available

Oligopoly

a state of limited competition, in which a market is shared by a small number of producers or sellers

Social factors

attitudes, values, ethics, and lifestyles

is an organization that strives for a profit by providing goods and services desired by its customers. A way of creating value!

business

Income, preferences, price of related products, expectations, and the number of buyers

changes in demand

New technology, price of other goods, number of suppliers, and taxes

changes in supply

is a set of moral standards for judging whether something is right or wrong

ethics

The least costly and least risky method for selling a product on the global market is

exporting

are goods and services made in one country and sold to others

exports

Key measures of international trade:

exports & imports, the balance of trade, the balance of payments, and exchange rates

Political and legal influences

federal, state, local

The budget, government taxation and spending

fiscal policy

Economic influences

fluctuations in the level of economic activity that create business cycles that influence businesses and individuals

The World Trade Organization (WTO)

has emerged as the world's most powerful institution for reducing trade barriers and opening markets

are goods and services that are bought from other countries

imports

International trade

improves relationships with friends and allies; helps ease tensions among nations; and - economically speaking - bolsters economies, raises people's standard living, provides jobs, and improves the quality of life

The question of fairness

justice

_________ move resources, goods, services, and skills, across national boundaries without regard to the country in which they are headquartered

multinational corporations

factors of production

natural resources, labor, capital, and entrepreneurship. Fifth factor: knowledge

Free trade:

permits people to buy and sell where they please

focuses on individual parts of the economy

Mico

The _______ created the world's largest free-trade zone

North American Free Trade Agreement (NAFTA)

4 components

Economic, legal, ethical and philanthropic responsibility

Are goods and services that are made in one country and sold to other countries

Exports

the quantity of a good or service that businesses will make available at different price

supply

Corporate Social Responsibility

the concern of businesses for the welfare of society as a whole, consists of obligations beyond those required by law or contracts

The standard of living of any country is measured by

the output of goods and services people can buy with the money they have

Perfect competition

the situation prevailing in a market in which buyers and sellers are so numerous and well informed that all elements of monopoly are absent and the market price of a commodity is beyond the control of individual buyers and sellers

seeking the best for the majority

utilitarianism

Monopolistic Competition

when an industry has many firms offering products that are similar but not identical

The difference between a country's total payments to other countries and its total receipts from other countries is called it's

balance of payments

The _______ is defined as the difference in value of a country's export's and imports over a period of time

balance of trade

If a country specializes in goods that it can produce most readily and cheaply and trades those goods for the goods that another country can produce most readily and cheaply, then both countries are exercising the principle of:

comparative advantage

The external environment includes

conditions that affect or influence businesses and are generally beyond the control of management and change constantly

A country's _______ is the set of beliefs, values, and social norms, shared by members of a society that determines what is socially acceptable

culture

the quantity of a good or service that people are willing to buy at various prices

demand

determines how much you can sell and at what price.

demand curve

Active ownership of foreign company, with direct investors having either a controlling or large minority interest in the firm is called

direst foreign market

Which of the following is an example of a natural trade barrier?

distance

The study of how a society uses scarce resources to produce and distribute goods and services

economics

A total prohibition against importing certain products is called a(n):

embargo

point at which Demand and Supply intersect

equlilibrium

issue is a situation where someone must choose between a set of actions that may be ethical or unethical

ethical issue

Government programs for controlling the amount of money circulating in the economy and interest rates

monetary policy

Establish a formal code of ethics

provides employees with the knowledge of what their firm expects in terms of their responsibilities toward fellow employees, customers, and suppliers