BIG Business Set (Midterm 1; Ch. 1-8)

The four basic rights of free-market capitalism

1)The right to own private property 2)The right to own a business and keep all that business's profits 3)The right to freedom of competition 4)The right to freedom of choice

Supply

The quantity of products that manufacturers or owners are willing to sell at different prices at a specific time

Demography

The statistical study of the human population with regard to its size, density, and other characteristics such as age, race, gender, and income.

Economics

The study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals

Resource development

The study of how to increase resources and to create the conditions that will make make better use of those resources

National debt

The sum of government deficits over time

Gross domestic product (GDP)

The total value of final goods and services produced in a country in a given year

Efficiency

producing goods and services using the least amount of resources.

Standard of living

refers to the amount of goods and services people can buy with the money they have.

Quality of life

refers to the general well-being of a society in terms of its political freedom, natural environment, education, health care, safety, amount of leisure, and rewards that add to the satisfaction and joy that other goods and services provide.

Goods

tangible products such as computers, food, clothing, cars, and appliances.

Profit

the amount of money a business earns above and beyond what it spends for salaries and other expenses needed to run the operation.

Risk

the chance an entrepreneur takes of losing time and money on a business that may not prove profitable.

Loss

occurs when a business's expenses are more than its revenues.

Market price

The price determined by supply and demand

Diversity

*Diversity efforts include hiring women, older adults, people with disabilities, people with different sexual orientations, atheists, religious people, extroverts, introverts, married people, and single people. *It also means dealing sensitively with workers and cultures around the world

Diversity

*Diversity efforts include hiring women, older adults, people with disabilities, people with different sexual orientations, atheists, religious people, extroverts, introverts, married people, and single people.*It also means dealing sensitively with workers and cultures around the world

What does the future look like for tomorrow's college students?

*Heavily technology based (or online) *Most everyone will work in the service industry at one point *Early retirement

Inclusion vs. Belonging

*Inclusion is about having a voice that is heard. *Belonging is about feeling part of a community.

What are the five factors of production? Which ones seem to be the most important for creating wealth?

*Land, Labor, Capital, Entrepreneurship, and Knowledge. *Entrepreneurship and Knowledge seem to be the most important for creating wealth (as seen within some rich countries) *Entrepreneurs use what they've learned (knowledge) to grow their businesses and increase wealth. *Economic and political freedom also matter.

What benefits do you lose by being an entrepreneur, and what do you gain?

*Lose: any benefits such as paid vacation time, day care, a company car, or health insurance. *Gain: freedom to make your own decisions, opportunity, and possible wealth.

What are some of the major issues affecting the economy today? (Fact check this one)

*Military workers *Retirement rate *Realistic quality vs. quantity *Managing diversity *Others?

What are some advantages of working for others?

*Somebody else assumes the company's entrepreneurial risk and provides you with benefits like paid vacation time and health insurance. *You're not in charge of your own time, which is a good thing for some people; more structure, less freedom of your career.

Globalization

*World Trade*Globalization has greatly improved living standards around the world.

Technology

*everything that makes business processes more effective, efficient, and productive. *from phones to computers, mobile devices, medical imaging machines, robots, the Internet, social media, and the various software programs and apps

Circular economy

*refers to reusing, redistributing, refurbishing, and recycling products instead of dumping them in landfills *in other words, keeping products in the value circle.

State Capitalism

A combination of freer markets and some government control

State capitalism

A combination of freer markets and some government control

Oligopoly

A degree of competition in which just a few sellers dominate the market

Monopoly

A degree of competition in which only one seller controls the total supply of a product or service, and sets the price

Inflation

A general rise in the prices of goods and services over time

Gross output (GO)

A measure of total sales volume at all stages of production

Invisible hand

A phrase coined by Adam Smith to describe the process that turns self-directed gain into social and economic benefits for all

Depression

A severe recession, usually accompanied by deflation

Deflation

A situation in which price increases are slowing (the inflation rate is declining)

Disinflation

A situation in which price increases are slowing (the inflation rate is declining)

Stagflation

A situation when the economy is slowing but prices are going up anyhow

All sectors of the economy

Agricultural, Industrial, and Service

Entrepreneurship (a factor of production)

All the resources in the world have little value unless entrepreneurs are willing to take the risk of starting businesses to use those resources.

Communism

An economic and political system in which the government makes almost all economic decisions and owns almost all the major factors of production

Socialism

An economic system based on the premise that some, if not most, basic businesses should be owned by the government so that profits can be more evenly distributed among the people

Capitalism

An economic system in which all or most of the factors of production and distribution are privately owned and operated for profit

Capitalism

An economic system in which all/most of the factors of production and distribution are privately owned and operated for profit

Database

An electronic storage file for information

Producer price index (PPI)

An index that measures the change in prices at the wholesale level

An economic boom

Businesses are doing well

Core inflation

CPI minus food and energy costs

Command economies

Economic systems in which the government largely decides what goods and services will be produced, who will get them, and how the economy will grow

Free-market economies

Economic systems in which the market largely determines what goods and services get produced, who gets them, and how the economy grows

Empowerment

Giving frontline workers the responsibility, authority, freedom, training, and equipment they need to respond quickly to customer requests.

What are four ways the government can foster entrepreneurship?

Help Promote: *Allow private ownership of businesses *Minimize interference with the free exchange of goods and services. *Establish a currency that's tradable in world markets. (That is, the currency lets you buy and sell goods and services anywhere in the world when it is easily exchanged for that of the other countries where you do business.)*Help minimize corruption in business and in its own ranks. Lessen Risks: *By passing laws that enable businesspeople to write enforceable contracts.

The right to own private property

Individuals can buy, sell, and use land, buildings, machinery, inventions, and other forms of property, as well as pass property onto their children. The most fundamental of all rights under capitalism

Knowledge

Information technology has revolutionized business, making it possible to quickly determine wants and needs and to respond with desired goods and services.

Land (or natural resources); (a factor of production)

Land and other natural resources are used to make homes, cars, and other products.

The 5 factors of production

Land, Labor, Capital, Entrepreneurship, Knowledge

Macroeconomics

The part of economics study that looks at the operation of a nation's economy as a whole

Consumer price index (CPI)

Monthly statistics that measure the pace of inflation or deflation

Hydroponics

New ways of creating needed goods and services such as nanotechnology

Natural gas for autos

New ways of growing food

Recovery

Occurs when the economy stabilizes and starts to grow

The right to freedom of choice

People are free to choose where they want to work and what career they want to follow. And what they buy and sell

Profit

Profit = revenues - expenses

The right to own a business and keep all that business's profits

Profits act as important incentives for business owners

Unemployment rate

The percentage of the civilians at least 16 years old who are unemployed and tried to find a job within the prior four weeks

Stakeholders

all the people who stand to gain or lose by the policies and activities of a business and whose concerns the business needs to address.

What is the difference between revenue and profit?

Revenue is the total amount of money a business takes in during a given period of time. Profit is the amount of money a business earns ABOVE and BEYOND what it spends for salaries and other expenses during a given period; ("extra money").

What is risk and how is it related to profit?

Risk is the chance an entrepreneur takes of LOSING TIME AND MONEY on a business that may not prove profitable. It is directly related to the amount of money a business brings in (profit), in the sense that the risk in the situation is how much profit comes from starting this business.

Greening

Saving energy and producing products that cause less harm to the environment, such as solar energy.

What is the difference between standard of living and quality of life?

Standard of living refers to the AMOUNT of goods and services people can buy with the money they have. Quality of life refers to the GENERAL WELL-BEING of a society in terms of its political freedom, natural environment, education, health care, etc. that add to the SATISFACTION that other goods and services provide.

What major factor caused people to move from farming to manufacturing and from manufacturing to the service sector?

Technology

Product differentiation

The attempt to make buyers think similar products are different in some way

E-commerce

The buying and selling of goods online

Monopolistic competition

The degree of competition in which a large number off sellers produce very similar products that buyers nevertheless perceive as different

Perfect competition

The degree of competition in which there are many sellers in a market and none is large enough to dictate the price of a product

Brain drain

The loss of the best and brightest people to other countries

Monetary policy

The management of the money supply and interest rates by the Federal Reserve Bank

Climate change

The movement of the temperature of the planet up or down over time.

Identity theft

The obtaining of individuals' personal information (such as Social Security and credit card numbers, for illegal purposes).

Microeconomics

The part of economics study that looks at the behavior of people and organizations in particular markets

Recession

Two or more consecutive quarters of decline in the GDP

The right to freedom of competition

Within certain guidelines established by the government, individuals are free to compete with other individuals or businesses in selling and promoting goods and services.

Entrepreneur

a person who risks time and money to start and manage a business.

A business

any activity that seeks to provide goods and services to others while operating at a profit.

Business environment

consists of the surrounding factors that either help or hinder the development of businesses.

Non-profit organization

contracting with other companies (often in other countries) to do some or all of the functions of a firm, like its production or accounting tasks.

Outsourcing

contracting with other companies (often in other countries) to do some or all of the functions of a firm, like its production or accounting tasks.

Services

intangible products (products that can't be held in your hand) such as education, health care, insurance, recreation, and travel and tourism.

Intellectual capital

includes employee knowledge and skills that can be used to create now products, attract new customers, and increase profits.

Business cycles

the periodic rises and falls that occur in economies over time

Insourcing

the practice of using an organization's own personnel or other resources (contracting within your own company) to accomplish a task that was previously outsourced.

Demand

the quantity of products that people are willing to buy at different prices at a specific time

Revenue

the total amount of money a business takes in during a given period by selling goods and services.