Intro to Business - Chapters 1-7 Vocab

What is the benefit a country has in a given industry when it can produce more of a product than other nations using the same amount of resources?

Absolute Advantage

A corporate restructuring in which one firm buys another.

Acquisition

Individuals who invest in start-up companies with high growth potential in exchange for a share of ownership.

Angel Investors

The document filed with a state government to establish the existence of a new corporation.

Articles of Incorporation

What is a measure of the total flow of money into or out of a country?

Balance of Payments

What is the shortfall that occurs when more money flows out of a nation than into that nation?

Balance of Payments Deficit

The transmission of information between a sender and a recipient.

Communication

The basic rules governing how a corporation is organized and how it conducts its business.

Corporate Bylaws

All business donations to nonprofit groups, including money, products, and employee time.

Corporate Philanthropy

Business contributions to the community through the actions of the business itself rather than donations of money and time.

Corporate Responsibility

A form of business ownership in which the business is considered a legal entity that is separate and distinct from its owners.

Corporation

What is international trade that involves the barter of products for products rather than for currency?

Countertrade

The measurable characteristics of a population. Demographic factors include population size and density as well as specific traits such as age, gender, and race.

Demographics

Vibrant, compelling presentation delivery style that grabs and holds the attention of the audience.

Dynamic Delivery

What is the study of the choices made by people, companies, and governments to allocate society's resources?

Economics

What is a specialized type of foreign licensing in which a firm expands by offering businesses in other countries the right to produce and market its products according to specific operating requirements?

Foreign Franchising

What is contracting with foreign suppliers to produce products, usually at a fraction of the cost of domestic production?

Foreign Outsourcing (Contract Manufacturing)

An international trade treaty designed to encourage worldwide trade among its members.

General Agreement on Tariffs and Trade (GATT)

A deep-seated sense that the individual is personally responsible for what happens in his or her life.

Internal Locus of Control

In the context of mixed economies, which of the following statements is true of the U.S. federal government?

It is part owner in a number of financial institutions.

When owners are not personally liable for claims against their firm. Owners with limited liability may lose their investment in the company, but their other personal assets are protected.

Limited Liability

A form of business ownership that offers both limited liability to its owners and flexible tax treatment.

Limited Liability Company (LLC)

A form of partnership in which all partners have the right to participate in management and have limited liability for company debts.

Limited Liability Partnership (LLP)

A partnership that includes at least one general partner who actively manages the company and accepts unlimited liability and one limited partner who gives up the right to actively manage the company in exchange for limited liability.

Limited Partnership

When a business incurs expenses that are greater than its revenue.

Loss

Communication that does not use words. Common forms of nonverbal communication include gestures, posture, facial expressions, tone of voice, and eye contact.

Nonverbal Communication

What is the opportunity of giving up the second-best choice when making a decision?

Opportunity Cost

The strategy of deliberately designing products to fail in order to shorten the time between purchases

Planned Obsolescence

The obligation of a business to contribute to society

Social Responsibility

What is a shortfall that occurs when the total value of a nation's imports is higher than the total value of its exports?

Trade Deficit

What is the overage that occurs when the total value of a nation's exports is higher than the total value of its imports?

Trade Surplus

ethical norms that apply across spectrum of situations

Universal Ethical Standards

The relationship between the price of a good or a service and the benefits that it offers its customers.

Value

Companies that invest in start-up businesses with high growth potential in exchange for a share of ownership.

Venture Capital Firms

Employees who report their employer's illegal or unethical behavior to either the authorities or the media

Whistle-Blowers

The service that allows computer users to easily access and share information on the Internet in the form of text, graphics, video, apps, and animation.

World Wide Web

In the context of monetary policy, when the economy is weak, the Fed:

buys government securities on the open market.

The marketing, buying, selling, and servicing of products over a network (usually the Internet).

e-commerce

A decision that involves a conflict of values; every potential course of action has some significant negative consequences.

ethical dilemmas

The unrestricted movement of goods and services across international borders.

free trade

The Board of Governors of the Federal Reserve holds a meeting to discuss its concern over the decreasing gross domestic product of the country. All members agree that the situation can be brought under control and the economy can be stimulated if they use the discount rate as a tool. In this scenario, the Fed is most likely to:

reduce the discount rate.

any groups that have a stake-or a personal interest-in the performance and actions of an organization

stakeholders

Attentive listening that occurs when the listener focuses his or her complete attention on the speaker.

Active Listening

Sentence construction in which the subject performs the action expressed by the verb (e.g., The accountant did the taxes.). The active voice works better for the vast majority of business communication.

Active Voice

What is the overage that occurs when more money flows into a nation than out of that nation?

Balance of Payments Surplus

What is a basic measure of the difference in value between a nation's exports and imports, including both goods and services?

Balance of Trade

A preconception about members of a particular group. Common forms of bias include gender bias; age bias; and race, ethnicity, or nationality bias.

Bias

The individuals who are elected by stockholders of a corporation to represent their interests.

Board of Directors

Any organization or activity that provides goods and services in an effort to earn a profit.

Business

The setting in which business operates. The five key components are: economic environment, competitive environment, technological environment, social environment, and global environment.

Business Environment

The application of right and wrong, good and bad, in a business setting

Business Ethics

A formal document that describes a business concept, outlines core business objectives, and details strategies and timelines for achieving those objectives.

Business Plan

Any tools—especially computers, telecommunications, and other digital products—that businesses can use to become more efficient and effective.

Business Technology

The most common type of corporation, which is a legal business entity that offers limited liability to all of its owners, who are called stockholders.

C Corporation

Marketing partnerships between businesses and nonprofit organizations, designed to spike sales for the company and raise money for the nonprofit.

Cause-Related Marketing

A formal, written document that defines the ethical standards of an organization and gives employees the information they need to make ethical decisions across the range of situations.

Code of Ethics

Obstacles to effective communication, typically defined in terms of physical, language, body language, cultural, perceptual, and organizational barriers.

Communication Barriers

The various ways in which a message can be sent, ranging from one-on-one in-person meetings to Internet message boards.

Communication Channels

What is the benefit a country has in a given industry if it can make products at a lower opportunity cost than other countries?

Comparative Advantage

A social movement that focuses on four key consumer rights: (1) the right to be safe, (2) the right to be informed, (3) the right to choose, and (4) the right to be heard.

Consumerism

People who risk their time, money, and other resources to start and manage a business.

Entrepreneurs

A set of beliefs about right and wrong, good and bad

Ethics

What is a measurement of the value of one nation's currency relative to the currency of other nations?

Exchange Rates

What is selling products in foreign nations that have been produced or grown domestically?

Exporting

A deep-seated sense that forces other than the individual are responsible for what happens in his or her life.

External Locus of Control

Four fundamental elements—natural resources, capital, human resources, and entrepreneurship—that businesses need to achieve their objectives.

Factors of Production

The country of Ukanturk has been facing an economic downturn for two consecutive years. To revive the financial condition of the country, its government tries to influence the economy through taxation and spending decisions that are designed to encourage growth and increase employment. In this scenario, the government of Ukanturk is implementing its

Fiscal Policy

A partnership in which all partners can take an active role in managing the business and have unlimited liability for any claims against the firm.

General Partnership

Troboli is a North American country. The total value of all final goods and services produced in Troboli in the last fiscal year was 3.3% more than the year before that. This growth placed Troboli in a better position than most of its allies. In this scenario, the total value of all final goods and services through which the economic condition of Troboli was assessed is known as _____.

Gross Domestic Product

Irkholm, a South American nation, experiences an economic downturn that leads to an increase in average prices across the country. The situation becomes more serious when average prices increase more than 50% per month. In the given scenario, Irkholm is experiencing _____.

Hyperinflation

What is buying products domestically that have been produced or grown in foreign nations?

Importing

An organization that pools contributions from investors, clients, or depositors and uses these funds to buy stocks and other securities.

Institutional Investors

Communication among people with differing cultural backgrounds.

Intercultural Communication

Identify a true statement about the Federal Reserve.

It manages the monetary policy of the United States.

Prior to formulating its annual budget, the government of the Asian country of Florenesia employs a number of individuals to look into the overall productivity of the country. These individuals are also responsible for studying and revising some of the taxation policies and gauging the employment rate. Given this information, these individuals are studying

Macroeconomics

A small segment of a market with fewer competitors than the market as a whole. Market niches tend to be quite attractive to small firms.

Market Niches

Any interference that causes the message you send to be different from the message your audience understands.

Noise

A corporation that does not seek to earn a profit and differs in several fundamental respects from C corporations.

Nonprofit Corporations

Business-like establishments that employ people and produce goods and services with the fundamental goal of contributing to the community rather than generating financial gain.

Nonprofits

Sentence construction in which the subject does not do the action expressed by the verb; rather, the subject is acted upon (e.g., The taxes were done by our accountant.). The passive voice tends to be less effective for business communication.

Passive Voice

The money that a business earns in sales (or revenue), minus expenses, such as the cost of goods and the cost of salaries. Revenue ‒ Expenses = Profit (or Loss).

Profit

The overall sense of well-being experienced by either an individual or a group.

Quality of Life

In a business cycle, the _____ is the transition period between contraction and expansion.

Recovery

In the context of monetary policy, the _____ is a rule set by the Fed, which specifies the minimum amount of funds a bank must hold, expressed as a percentage of the bank's deposits.

Reserve Requirement

A form of corporation that avoids double taxation by having its income taxed as if it were a partnership.

S corporations, statutory close corporations

An organization—affiliated with the Small Business Administration—that provides free, comprehensive business counseling for small business owners from qualified volunteers.

SCORE (Service Corps of Retired Executives)

Federal legislation passed in 2002 that sets higher ethical standards for public corporations and accounting firms. Key provisions limit conflict-of-interest issues and require financial officers and CEOs to certify the validity of their financial statements.

Sarbanes-Oxley Act

Shayla is performing a social audit of her company. She needs to evaluate how well the firm is meeting its ethics and social responsibility objectives. To do this, she first establishes the goals that the company should strive to meet. Which of the following is most likely to be the subsequent step performed by Shayla?

She would determine how to measure the achievement of the established goals.

An agency of the federal government designed to maintain and strengthen the nation's economy by aiding, counseling, assisting, and protecting the interests of small businesses.

Small Business Administration (SBA)

Local offices—affiliated with the Small Business Administration—that provide comprehensive management assistance to current and prospective small business owners.

Small Business Development Centers (SBDCs)

The government of Bakhraan, an Asian country, owns key industries that directly affect public welfare, such as healthcare and telecommunications. To fund public welfare schemes, such as free childcare and free education, the government levies high taxes on its citizens. In the given scenario, the economic system followed by Bakhraan is _____.

Socialism

A form of business ownership with a single owner who usually actively manages the company.

Sole Proprietorship

The rate at which a new product moves from conception to commercialization.

Speed-to-market

The quality and quantity of goods and services available to a population.

Standard of Living

An owner of a corporation.

Stockholders

Doing business to meet the needs of the current generation, without harming the ability of future generations to meet their needs.

Sustainable Development

The economy of Sutanvia is under severe financial distress. However, over the last few months, the economy has gradually picked up, and employment levels are slowly rising back to normal levels. Consumers are also beginning to engage in regular buying activities. In this scenario, the economy of Sutanvia is currently in the _____ phase of its business cycle.

recovery

Gregory was a typist at a corporate firm. When the company adopted a special voice recognition software for the purpose of documentation, Gregory's job became redundant. Therefore, he was laid off. The increased use of technology in most companies has made Gregory's skills inessential, and he remained unemployed for a long time. In the given scenario, Gregory is facing _____.

structural unemployment

During a period of grave financial crisis in the United States, Congress is pressurized to raise the limit on the maximum amount of money the government can borrow. Congress increases the limit on the condition that it will implement sharp tax hikes and across-the-board spending cuts to compensate for the raise and to ensure that the overall budget deficit decreases. In this scenario, the measures implemented by Congress will most likely create:

the fiscal cliff.

The central banking system in the country of Darmos issues a notice to all its commercial banks stating that they must hold funds that are equal to 48% of the deposits held by their customers. In the given scenario, the central banking system's notice exemplifies _____.

the reserve requirement