Business Ch 1-4

Be able to identify the various types of characteristics that the U.S. Equal Employment Opportunity Commission prohibits discrimination against.

Age Disability Equal Pay/Compensation Genetic Information Harassment National Origin Pregnancy Race/Color Religion Retaliation Sex Sexual Harassment

Parties involved with the North American Free Trade Agreement (NAFTA).

Agreement that created a free-trade area among the United States, Canada, and Mexico.

Non-profit Organization

An organization whose goals do not include making a personal profit for its owners or organizers. Nonprofit organizations often do strive for financial gains, but they use them to meet their social or educational goals rather than for personal profit.

Definition of a business.

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

Definition of Corporate Social Responsibility

Corporate Social Responsibility (CSR)- the concern businesses have for the welfare of society, not just for their owners. Based on a commitment to integrity, fairness, and respect.

4 phases of long-term business cycles

Economic Boom- business is booming. Recession- two or more consecutive quarters of decline in the GDP. Prices fall, people purchase fewer products, and business fail. High unemployment, increased business failures, and an overall drop in living standards. Depression- a severe recession, usually accompanied by deflation. Recovery- occurs when the economy stabilizes and starts to grow. Leads to economic boom, starts over again.

Mixed economies

Economic systems in which some allocation of resources is made by the market and some by the government. If free-market allocate most resources, capitalism. If government allocate most resources, socialism.

Three questions that will help individuals and organizations when deciding if their decisions are ethical.

Is my proposed action legal? (law or company rules) Is is balanced? (fair) How will it make me feel about myself? (would I feel proud)

Peter Drucker said is most important production factor

Knowledge

Know the 5 factors of production that can lead to wealth creation.

Land Labor Capital Entrepreneurship Knowledge

What companies are using to communicate their corporate responsibility actions to their customers.

Many companies use to raise awareness of their social responsibility efforts via social media.

Revenue-Expenses=

Profit or Loss

4 basic rights for consumers proposed by former President John F. Kennedy

Right to be safe Right to be informed Right to choose Right to be heard

Be able to identify the various stakeholders of a business.

Stockholders, Customers, Surrounding community, Environmentalists, Dealers (retailer), Employees, Government leaders, Suppliers, Media, Bankers.

Standard of living

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

Quality of life

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.

Comparative Advantage Theory

a country should sell to other countries those products that it produces most effectively and efficiently, and buy from other countries those products that it cannot produce effectively or efficiently.

Capitalism

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

Insider trading

an unethical activity which insiders uses private company information to further insider's own fortunes or those of their family and friends.

Foreign Direct Investment

buying the permanent property and businesses in foreign nations.

Embargo

complete ban on the import or export of a certain product, or the stopping of all trade with particular country.

Integrity-based Ethics Codes

define the organization's guiding values, create an environment that supports ethically sound behavior, and stress shared accountability.

Balance of Payments

difference between money coming into a country from exports and money leaving the country for imports plus money flows in or out from a country like tourism, foreign aid, military expenditures, and foreign investment.

Complianced-based Ethics Codes

emphasize preventing unlawful behavior by increasing control and penalizing wrongdoers.

Whistle-blower

insiders who report illegal or unethical behavior.

Profit

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

Monetary policy

is the management of the money supply and interest rates by the Federal Reserve Bank. The Fed's most visible role is the raising and lowering of interest rates.

Unfavorable balance of trade - Trade deficit

occurs when the value of a country's export more than they import.

Trade surpluses

occurs when the value of a country's exports exceeds that of imports.

Fiscal policy

refers to the federal government's efforts to keep the economy stable by increasing or decreasing taxes or government spending.

Dumping

selling products in a foreign country at lower prices than those charged in the producing country.

Adam Smith's theory of the "Invisible Hand"

the process that turns self-directed gain into social and economic benefits for all.

National debt

the sum of government deficits over time.

Revenue

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

Balance Trade

the total value of a nation's export compared to imports measured over a particular period.

Absolute Advantage Theory

when a country produces a specific product more efficiently than all other countries.