Chapter 1: Business Now: Change Is the Only Constant

Vocabulary flashcards covering core business concepts, historical eras of American business, factors of production, and key dimensions of the business environment.

Value

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

Business

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

Profit

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

Loss

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

Entrepreneurs

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

Standard of Living

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

Quality of Life

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

Industrial Revolution

An era from the mid-1700s to the mid-1800s where technological advances fueled rapid industrialization in America.

Entrepreneurship Era

An era in the second half of the 1800s where large-scale entrepreneurs emerged and built business empires.

Production Era

An era in the early 1900s where businesses refined production processes and created greater efficiencies.

Marketing Era

An era after WWII where businesses began to develop brands to help consumers understand the differences among different products.

Relationship Era

An era today where firms aim to build long-term relationships with customers.

Nonprofits

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

Factors of Production

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

Natural Resources

Inputs that offer value in their natural state.

Capital

Synthetic resources that a business needs to produce goods or services.

Human Resources

Physical, intellectual, and creative contributions of everyone who works within an economy.

Entrepreneurship (Factor of Production)

Process of creating opportunities by harnessing other factors of production.

The Business Environment

The context for success, comprising the economic, competitive, technological, social, and global environments.

Speed-to-Market

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

Bleeding Edge

Launching products too far ahead of the market and, as a result, experiencing failure.

Business Technology

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

E-Commerce

Business transactions conducted online, typically via the internet.

Demographics

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

Free Trade

An international economic and political movement designed to help goods and services flow more freely across international boundaries.

General Agreement on Tariffs and Trade (GATT)

An international trade agreement that has taken bold steps to lower tariffs and promote free trade worldwide.