Business Dynamics- Unit 1

Needs

Things you must have to survive

Wants

Things you DO NOT have to have in order to survive are called

Business

Any commercial activity that seeks profit by providing goods and services to others in exchange for money

Goods

physical products

Service

tasks that a business performs for customers

Profit

The money left over after a business has paid the cost of providing its goods and services

Competition

The contest between businesses to win customers

Market Research

The act of gathering and analyzing information about the needs, wants, and preferences of consumers in a certain market

Factors of production

 All the economic resources necessary to produce a society's goods and services

Natural Resources

Raw materials from nature that are used to produce goods

Labor Resources

People who make the goods and services for which they are paid

Capital Resources

The things used to produce goods and services such as buildings, materials, and equipment

Entrepreneurial Resources:

 Resources used by the people who recognize opportunities and start businesses

Entreprenuership

Recognizing a business opportunity, testing it in the market and gathering resources to start/run a business

Market Economy

Economic system where decisions are made in the marketplace

Command Economy

an economic system in which a central authority makes the key economic decisions

Price

 The amount of money given or asked for when goods and services are bought or sold

Business Cycle

The rise and fall of economic activity 

Prosperity

A peak of economic activity

Recession

When economic activity slows down

Depression

A deep recession

Recovery

A rise in activity after a recession or depression

GDP stands for

Gross Domestic Product

GDP definition

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

Standard of Living

The level of material comfort measured by the goods and services that are available

Unemployment Rate

Measures the number of people able and willing to work who cannot find work

Inflation

A general increase in the price of goods and services

How business affects consumers

when a product is discontinued

How consumers affect business: (1/3)

Decide what kind of goods and services they want (1)

How consumers affect business: (2/3)

decide where they will buy goods and services (2)

How consumers affect business: (3/3)

decisions can determine the success or failure of a business (3)

**The Importance of Business definition**

provides jobs and taxes

**Characteristics of a Market Economy: 1/8**

(1) Resources are privately owned

**Characteristics of a Market Economy:  2/8**

(2)Citizens can own their own homes, land, and businesses

**Characteristics of a Market Economy: 3/8**

(3)Business owners decide how their businesses will be run

**Characteristics of a Market Economy: 4/8**

(4)Business owners decide what to produce and sell

**Characteristics of a Market Economy:  5/8**

(5)Business owners decide what to charge

**Characteristics of a Market Economy: 6/8**

(6)Government works to promote free trade and prevent unfair trade practices

**Characteristics of a Market Economy: 7/8**

(7)Consumers choose their occupations and where to live

**Characteristics of a Market Economy: 8/8**

(8)There is an uneven distribution of income

**Characteristics of a Command Economy: 1/6**

(1)The government dictates what will be produced, how it will be produced, and who will get the goods

**Characteristics of a Command Economy: 2/6**

(2)There is little choice of what to buy

**Characteristics of a Command Economy: 3/6**

(3)Goods are not considered necessities

**Characteristics of a Command Economy: 4/6**

(4)Prices are controlled by the state

**Characteristics of a Command Economy: 5/6**

(5)There is no competition and little incentive to produce a better product

**Characteristics of a Command Economy: 6/6**

(6)Highly skilled workers may earn the same as low-skilled workers

The importance of business reason 1/4

(1)provide goods that make life easier and better

The importance of business reason 2/4

(2)Provide services that make life easier and better

The importance of business reason 3/4

(3)provide consumers with necessities

The importance of business reason 4/4

(4)Provide food, clothing, housing, medical care and transportation.