Economics and Entrepreneurship: Key Concepts and Market Structures

entrepreneur

An entrepreneur is an individual who undertakes the creation, organization, and ownership of an innovative business with potential for growth.

venture

A venture is a new business undertaking that involves risk.

entrepreneurship

Entrepreneurship is the process of recognizing or creating an opportunity, testing it in the market, and gathering the resources necessary to go into business.

economics

Economics is the study of how people choose to allocate scarce resources to fulfill their unlimited wants.

free enterprise

Most democratic nations have a free enterprise system.

system

The company implemented a reward system to encourage good behavior.

profit

Profit is money that is kept after all expenses.

market structure

A market structure describes how businesses compete within an industry.

monopoly

A monopoly is a market structure in which a particular commodity has only one seller who has control over supply and can exert nearly total control over prices.

oligopoly

An oligopoly is a market structure in which there are just a few competing firms.

goods

Goods are physical products.

services

Services are experiences of activities.

need

Something you need to service.

want

Something you do not require you can add comfort is a want.

factors of production

Factors of production are the resources businesses use to produce the goods and services that people want.

scarcity

Scarcity occurs when demand exceeds supply.

demand

Demand is the quantity of goods or services that consumers are willing and able to buy.

elastic demand

Elastic demand refers to situations in which a change in price creates a change in demand.

inelastic demand

Inelastic demand refers to situations in which a change in price has very little effect on demand for products.

diminishing marginal utility

Diminishing marginal utility is when even when a product's price is low, people will not keep buying it indefinitely.

supply

The amount of a good or service that producers are willing to provide is called supply.

equilibrium

Equilibrium is the point at which consumers buy all of a product that is supplied.

Gross Domestic Product

Gross Domestic Product is the total market values of goods and services produced by a nation during a given period.

business cycle

A business cycle is the periodic random pattern of expansion and contraction that the economy goes through.

enterprise zones

Enterprise zones are specially designated areas of a community that provide tax benefits to new businesses locating there and grants for new product development.

opportunity

An opportunity is an idea that has commercial potential.

start-up resources

The start-up resources include the capital, skilled labor, management expertise, legal and financial advice, facility, equipment, and customers needed to start a business.

new venture organization

The fifth component of the entrepreneurial start-up process is the execution of the new business concept through a new venture organization.

business failure

A business failure is a business that has stopped operating with a loss to creditors.

discontinuance

A discontinuance is a business that was purposely discontinued by an owner who wanted to start a new one.

evaluate

The Federal Reserve constantly evaluates economic conditions.

enable

Computers, smart phones, and other kinds of information technology enable people to communicate instantly, collaborate from a distance, and keep records more efficiently.

technology

Most recently, the advent of new media technologies has made it possible for entrepreneurs to do business from anywhere and reach customers in cost-effective and efficient ways anywhere in the world.

environment

Environment is how the scene of something is, for example how the economy is running.

Law of supply

Producers produce more at a higher price than a lower price.

Law of demand

According to the law of demand, as price goes up, the quantity demanded goes down.