Economics Semester 2

Vocabulary:

Safety in the market:

Insolvency: Inability to pay back one's debts.

Dividend: a sum of money paid regularly by a company to its shareholders out of its profits

Government bond: A debt issued by the government to support their activities, acting as a loan to its buyers.

Superannuation: regular payment made into a fund by an employee toward a future pension.

Life insurance: a contract where the insurer promises to pay a sum of money in exchange for a premium, upon the death of an insured person or after a set period.

Risk-averse investor: an investor who prefers lower returns with known risks rather than higher returns with unknown risks.

Ethics: A set of moral principles that a business needs to establish and follow.

Corporate Social Responsibility (CSR): A self-regulating business model that helps a company be socially accountable to itself, its stakeholders, and the public.

Competition:

Brand: a type of product manufactured by a particular company under a particular name.

Competition: The rivalry that occurs among sellers in their desire to seek and satisfy a market.

Unique selling point (USPs): Marketing that makes a product appear different from others in the market.

Competitive advantage: A point of difference or superiority held over a business’s competitors.

Market: Any place where the sellers of a particular good or service can meet with the buyers of that good and service and where there is potential for a transaction to take place

Market share: The percentage of total sales in a market held by one brand or business

Brand leader: The brand in the market with the largest share

Monopoly: Market containing a single business.

Open innovation: The practice of businesses and organizations sourcing ideas from external sources as well as internal ones.

Product differentiation: The characteristics that make your product or service stand out to your target audience

Social responsibility: Ethical theory in which individuals are accountable for fulfilling their civic duty, and the actions of an individual must benefit the whole of society

Stakeholder: A person, group, or organization with a vested interest, or stake, in the decision-making and activities of a business, organization, or project

List the 7 P’s: Product, Price, Place, Promotion, People, Process, Physical Evidence.

Open innovation: A distributed innovation process based on purposively managed knowledge flows across organizational boundaries in line with the organization's business model

Patents: A government authority or license granting a right or title for a set period, especially the sole right to exclude others from making, using, or selling an invention.

Decision-making unit (DMU): All the people who play a role in purchasing a product.

Decision-making process (DMP): A description of the interactions made in the purchasing decision.

Blogs: Entires about a certain topic that can be written by a business or a person to recommend or discourage against a certain business.

Discrimination:

Employee relation: The relationship between employees and employers encompassing all aspects of their working lives.

Direct discrimination: An employee is treated in a less favourable manner due to factors such as sex, nationality, or religion.

Indirect discrimination: Imposing a requirement that is normal for the common people but impossible for a specific group of people.

Fair Work Ombudsman: Has the power to investigate allegations of workplace discrimination and then start legal proceedings.

Employed: A person over the age of 15 who has worked for more than one hour of payment.

Government: A group with authority to govern a country or state

Unemployed: A person over the age of 15 who has not been paid for any work and has been looking for one at least for a four-week period.

Notes:

Benefits of competition:

• Businesses are forced to serve their customers better
• Promotes innovation and efficiency.
• Identify a business’s strengths and weaknesses, letting them narrow their focus and overcome hardships.
• Identify potential threats from competitors.
• Stops complacency.
• Overall improvement to the market.

External factors for a business:

Social

Tech

Ecology

Ethics

Politics

Laws

Economics

Price/Feature matrix:

• A differentiated product can go at a higher price
• Similar products with a lower price is also a strategy.

Decision-making unit:

• Buyer: the person who issues the check
• Decider: The person or group that says that this is the product we want
• Influences: who helps the person decide
• User: The person or group who actually uses the product and benefits from it

Social media:

Pros:

• Quickly and cheaply contact a large number of customers globally
• Craft your message to be personal and directed towards a specific group of people

Cons:

• The risks of posting incorrect information and having it spread rapidly
• Legal problems related to privacy

Discrimination:

Adverse actions or discriminatory acts:

• Conduct that is intimidating, offensive, or humiliating.
• Unwanted and offensive sexual advancements.
• Treating an employee adversely because they have complained before.
• Detrimentally altering the position of an employee without proper evidence
• Areas such as complexity of tasks, harassment, and comparative workload.