Chapter 1 – The Evolution of US Business: Vocabulary Flashcards

Vocabulary flashcards covering key terms from the lecture notes on the business environment, wealth creation, entrepreneurship, and related concepts.

Polling

A tool in McGraw Hill Connect that allows real-time feedback from students; slides labeled “Polling Question” can be converted into polling questions.

Revenue

Total amount of money a business takes in during a given period by selling goods and services.

Profit

Amount of money a business earns above and beyond what it spends for salaries and other expenses.

Loss

When a business’s expenses are more than its revenues.

Business

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

Goods

Tangible products such as computers, food, clothing, cars, and appliances.

Services

Intangible products (that can’t be held) such as education, health care, insurance, recreation, and travel and tourism.

Entrepreneur

A person who risks time and money to start and manage a business.

Outsourcing

Contracting with other companies (often in other countries) to do some functions of a firm, like production or accounting.

Insourcing

Foreign companies opening design and production facilities in the United States.

Nonprofit organization

An organization whose goals do not include making a personal profit for owners; profits are used to meet social or educational goals.

Stakeholders

All the people who stand to gain or lose by the policies and activities of a business and whose concerns the business needs to address.

Empowerment

Giving frontline workers the responsibility, authority, freedom, training, and equipment they need to respond quickly to customer requests.

Demography

The statistical study of the human population with regard to size, density, and characteristics such as age, race, gender, and income.

Diversity

The presence of differences in a workforce and efforts to promote inclusion and belonging.

Gen Z

Generation born 1995–2009; the largest group of consumers; marketers use social media and influencers to reach them.

Land

Natural resources used to create wealth.

Labor

Workers; human effort used to produce goods and services.

Capital

Financial resources used to fund production.

Entrepreneurship (factor of production)

The act of starting and managing a business; taking risks to organize resources and create wealth.

Knowledge

Intellectual capital; knowledge resources used to create wealth.

The Five Factors of Production

The five resources used to create wealth: Land, Labor, Capital, Entrepreneurship, Knowledge.

Economic and Legal Environment

Government can promote entrepreneurship by allowing private ownership, minimizing interference with trade, enacting enforceable contracts, maintaining tradable currency, and minimizing corruption.

Technological Environment

The impact of technology—information technology, databases, bar codes, the Internet—on business and productivity.

Competitive Environment

Ways firms compete, including customer service, stakeholder recognition, employee service, and concern for the environment.

Social Environment

Social factors such as diversity, demographic changes, and family changes that affect business.

Global Environment

Globalization and its effects; war and terrorism drain economies and create uncertainty.

E-commerce

Buying and selling of goods online; includes B2C (business-to-consumer) and B2B (business-to-business).

Productivity

The amount of output generated given the amount of input.

Circular Economy

A sustainability approach that aims to keep products in the value circle with no waste, using recycling or reuse of materials.

Information Age

The information-based global and technical revolution; much of a company’s value comes from intellectual capital and innovation.

Intellectual Capital

The knowledge, skills, and experience that contribute to a company’s value.

War and Terrorism

Events that drain trillions from the economy and create uncertainty, impacting business risk.

Evolution of US Business

Progress from agriculture to manufacturing and then to service and information-age industries, driven by technology and productivity.