Chapter 2: Entrepreneurial Activities - Unit 4: Trading

Practice flashcards covering entrepreneurial activities, retail store types, non-store retailing, manufacturing components, service businesses, profit concepts, and the circular flow of exchange based on Unit 4 lecture notes.

What is the definition of trading in entrepreneurial activities?

Trading is the process of buying and selling goods without changing their form or nature.

What is the distinction between retailing and wholesaling?

Retailing is selling goods in small quantities directly to final consumers, whereas wholesaling is selling goods in large volumes, typically to retailers or businesses.

What are the three core business activities every entrepreneur should know?

The three core business activities are Trading / Merchandising, Manufacturing, and Service Business.

What examples of trading, manufacturing, personal service, and professional service are given in the lecture?

Trading: Sari-sari store; Manufacturing: Furniture maker; Personal service: Barbershop; Professional service: Accounting firm.

How are retail stores categorized based on the level of service provided in the lecture examples?

Self-Service Retailer (e.g., Supermarket like Walmart), Limited Service Retailer (e.g., Dress Store), and Full Service Retailer (e.g., Cellphone Store).

Which specific examples are provided for a Specialty Store and a Department Store?

Powerbooks is an example of a Specialty Store, and Robinsons is an example of a Department Store.

How is a Hypermart defined in the transcript?

A Hypermart (such as SM Hypermart) is a large-scale store that combines grocery and general merchandise.

What are Price clubs / Warehouse clubs, and what example is mentioned?

Price clubs / Warehouse clubs involve bulk buying at wholesale prices for members; an example given is Makro.

What example of non-store door-to-door direct selling is provided in the lecture?

Door-to-door sellers like AVON representatives bringing products directly to customers.

What are the three production cost components involved in manufacturing raw materials into finished products?

Raw materials (e.g., leather, paper, wood), Direct labor (e.g., carpenter, sewer, assembler), and Factory overhead (e.g., electricity, supervisor salary, rent, water).

What formula is used to calculate profit?

$$\text{Profit} = \text{Selling Price} - \text{Cost and Expenses}$$

What is mark-up in entrepreneurial pricing?

Mark-up is setting the selling price above total cost and overhead to ensure a profit.

What are the specific direct costs associated with retail, manufacturing, and service businesses?

Retail direct costs are product costs; manufacturing direct costs are materials and labor; service direct costs are the costs of rendering services.

How can National Bookstore function as both a retailer and a wholesaler?

It acts as a retailer when selling bond paper directly to students and companies (final consumers), and as a wholesaler when selling in bulk to Don Bosco Book Store.

What are the five ways to classify retail stores listed in the transcript?

Amount of Service, Product Line, Retail Prices, Control Outlets & Store Cluster, and Type of store cluster.

What are the six types of non-store retailing mentioned in the lecture?

Direct Marketing, Direct Mail Marketing, Catalogue Marketing, Telemarketing, Television Marketing, and Electronic Marketing.

How does fast retail turnover affect shelf costs and cash flow?

Fast retail turnover reduces shelf costs (expenses from space, electricity, and handling) and improves overall cash flow for the business.

What are four benefits of retail trading outlined in the lecture?

Fast product movement through discounts and promotions, volume purchase incentives, enhanced buyer-owner relationships through friendliness and service, and support for low-budget families through small quantity purchases.

How does money circulate in the circular flow of exchange?

Money continuously circulates among households, businesses, government, and banks, where households sell labor for wages and businesses supply goods and services.

What is the economic impact of hoarding money outside of circulation?

Hoarding money outside of circulation disrupts economic activity and harms overall development and growth.