Chapter 1: Taking Risks & Making Profits w. a Dynamic Business Environment

What is a Business

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

Are good tangible or intangible?

tangible (things you can physically touch)

Are services tangible or intangible?

intangible ( you cannot touch it)

What is an entrepreneur?

a person who risks time, effort, and money to start and operate a business

What is revenue in the business context

Revenue is the amount of money takes in during a given period . The TOTAL MONEY you make BEFORE EXPENSES.

What is a profit in business

amount of money a business earns above and beyond what is spends on salaries and other expenses need to run the operation. TOTAL MONEY AFTER EXPENSES

What is a loss

when the business expenses are greater than its revenue. NET LOSS.

What is risk in business

the chance an entrepreneur takes of losing time and money on a business that may not be profitable

What does the term 'standard of living' refer to?

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

What does the term Quality of life refer to

The general well being of a society in terms of political freedom, environment, healthcare that add satisfaction to day to day life

what is the difference between standard of living vs quality of life

Standard of living is superficial what you can buy with how much you earn . Quality of life is how happy you are

What is a stakeholder?

any group or individual who can affect or is affected by the achievement of the business's objectives.

Stakeholder vs shareholder what is the difference?

A Share holder has $ involved in a business such as stocks. A stakeholder is anyone/everyone who will be affected by policies of a business.

Why do companies choose to outsource

It is typically cheaper for a business to look for employees in a poorer country where they can pay them a poorer wage.

What is outsourcing?

contracting with another company to perform a broad set of services like accounting.

What is insourcing?

Foreign companies opening offices and factories in the United States. like Kia opening offices in America.

what is the opposite of insourcing?

Outsourcing

The goals of a nonprofit organization are

social , educational, and nonprofit-oriented

What is a nonprofit organization?

an organization whose goals do not include making a personal profit for its owners or organizers

What is the difference between a nonprofit organization vs a standard Business?

A regular Business is strictly PROFIT ORIENTED. While a nonprofit is SOCIAL AND EDUCATIONAL ORIENTED. A non profit doesn't care about money

What are the Five Factors of Production that contribute to wealth?

1.) Land or natural Resources

2.) Labor

3.) Capital

4.) Entrepreneurship

5.) Knowledge

According to Peter Drucker, what is the most important factor of production in our economy?

Knowledge

What is capital?

money or wealth used in the production of goods. Is not just money can also be assets like Equipment.

What has revolutionized Business?

TECHNOLOGY

What is the business environment?

surrounding factors that hinder or help the develpoment of the business

what contributes to wealth?

The Five Factors of production

What are the five elements of the business environment?

1.) Economic and Legal

2.) Technological

3.) Competitive

4.) Social

5.) Global Business

In what ways can the government work with business to create a better economic and legal environment?

1.) Minimize taxes and regulations

2.) allow private ownership

3.) lessen the risk for entrepreneurs with laws

4.) establish tradable currency

5.) Minimize corruption

What is efficiency?

producing good and services using the least amount of work

What is effectiveness?

producing the desired result

What is productivity?

the amount of output you generate given the amount of input like hours worked.

what does technology allow business to achieve?

allow a business to process more effectively, efficiently, and productively.

What is e-commerce?

Buying and selling goods online.

what are the two major types of e-commerce transactions?

B2C. & B2B

what is a consequence on relying to much on the internet while conducting business ?

Identity Theft due to a leaked business database

What do businesses have to offer customers to remain competitive?

High quality goods and services at a good value

What is demography?

the study of population with regards to size density and race and density

The social environment of business is concerned with

Managing Diversity

What does Diversity mean in the business sense?

means more than just recruiting ethnic and racial minorities. It means recruiting people with disabilities old age and sexual orientations and religious background.

What was the ratio of workers to retirees in 1940?

42 worker to 1 retiree

What is the ratio of worker to retirees now?

2.8 will be 2.3 worker to 1 retiree

What is the estimated spending power of Generation Z in the United States?

$360 billion

What is climate change?

a change in global or regional climate patterns

What is greening?

the trend toward saving energy and producing products that cause less harm to the environment such as solar energy

what is empowerment?

giving employees the power to act immediately, decisively, and without fear in order to gain the delight of customer

How do Business compete with each other

they compete by exceeding customers expectations and by restructuring and empowering their workforce

What are two things that account for managing diversity

creating a workplace that fosters inclusion and belonging

what is inclusion

the action or state of including or of being included within a group or structure. Having a voice that is heard

What is belonging

feeling you are apart of a community?

What two countries are creating the greatest competitive challenges?

China and India

Since the mid-1980s, almost all new job creation in the United States has occurred in the __________Blank sector.

a.) manufacturing

b.) telecommunications

c.) service

d.) agricultural

service

Health care, entertainment, and finance are all business that are part of the __________Blank sector.

neo-industrial

production

service

management

service