Business Foundations - Lecture Notes (Syllabus Supplement)

Vocabulary flashcards covering key concepts from the lecture: definitions of business, profit, organizational forms, factors of production (including land, labor, capital, knowledge, entrepreneurship), product concepts (goods, services, hybrids), stakeholders, pestle environment, competitive structures, ethics, and CSR.

Business

The organized efforts of people to produce or provide goods/services to satisfy needs while aiming for profit.

Profit

Money left over after all expenses are paid; revenue minus costs.

For-profit organization

An organization that aims to earn profits for owners or shareholders; profits may be distributed.

Not-for-profit organization

An organization that reinvests any profits back into its mission and has no owners to distribute profits to.

Factors of production

Land, labor, capital, knowledge, and entrepreneurship used to produce goods and services.

Land

Natural resources and raw materials used in production.

Labor

Human effort used in the production of goods and services.

Capital

Financial resources and physical assets used to produce goods/services.

Knowledge

Human know-how and information used in production.

Entrepreneurship

Willingness to assume risk and organize resources to create new products or processes.

Product

Any good or service produced to meet customer needs.

Good

A tangible product that you can touch.

Service

An intangible product; an action or performance that satisfies needs.

Hybrid product

A product that combines tangible goods with accompanying services.

Stakeholders

Groups affected by a business's actions (owners, customers, employees, suppliers, distributors, lenders, communities, regulators, interest groups, media).

Owners/Stockholders

People who own a stake in the company; in not-for-profit there are no owners.

Pestle analysis

A framework classifying external factors into Political, Economic, Sociocultural, Technological, Legal, and Ecological.

Political environment

Government policies, regulations, and political factors affecting business.

Economic environment

Macro conditions shaping the economy (growth, inflation, unemployment, etc.).

Sociocultural environment

Societal cultures, demographics, values affecting business decisions.

Technological environment

Advances in technology affecting production and markets (AI, automation, etc.).

Legal environment

Laws and regulations governing business operations.

Ecological environment

Natural environment and sustainability considerations.

Competitive structures

Market configurations based on number of buyers/sellers and product similarity.

Perfect competition

Many buyers and sellers; homogeneous products; no single firm controls price.

Oligopoly

Few large sellers; high barriers to entry; products may be similar or differentiated.

Monopolistic competition

Many sellers with differentiated products; competition on attributes and branding.

Monopoly

Single seller with market power; high barriers; price setting.

Ethics

Moral principles guiding business actions; not limited to legality; shaped by culture and society.

Code of conduct

Formal policy outlining expected ethical and professional behavior.

Sunshine test

Would you be comfortable if your decision became public and scrutinized?

Five-question ethics framework

Is it legal? Is it balanced and fair? How would I feel about myself? How would I feel if it were public (sunshine)? Is it aligned with organizational standards?

Corporate Social Responsibility (CSR)

A company's commitment to act ethically and contribute to economic development while improving the quality of life of employees, local communities, and society.

Corporate social responsibility components

CSR components described in the course (e.g., policy, philanthropy, social initiatives, and governance/ethics practices).