BCOR 199-Exam1

Chapters 1-3

Understanding Business by Nickels

personalized - does not include everything

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Elements of Business Environment

• economic&legal
• technological
• competitive
• social

Global factors = trade agreements, wars/threats, economic conditions, climate change

Communism vs Socialism vs Capitalism

==Communism== - everything restricted and managed by gov

==Socialism== - only basic economy restricted (ex. mining)

==Capitalism== - only regulations, no gov control

==Business== - any activity seeking to provide goods and services for profit

Challenges of new leaders since the global information-based revolution;

• service era closing (though still the largest)
• learning world quality standard

Monetary vs Fiscal Policy

==Monetary Policy== - economic balance by money supply and interest rates

==Fiscal Policy== - increasing and decreasing taxes and gov spending to stabilize the economy

Business Cycles

boom → recession → depression → recovery

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==Franchising== - good idea w/business sells others the right to use business name and sell product or service in a given territory in a specified manner

==Licensing== - give right to manufacture or use the trademark to foreign company for a small fee

• Export Assistance Centers handle direct exporting and provide hands-on exporting assistance and trade-finance support for small and medium-sized businesses
• think foreign subsidiary as parent country with other country like U.S and Britain before Declaration of Independence
• Small and medium business are often better prepared to extend into global markets and react quickly to opportunities

Obstacles in Global Markets

• sociocultural
• economic&financial
• legal&regulatory
• physical&environmental

==Trade Protectionism== - limit on number of products in certain categories that a nation can import

==Joint Venture== - partnership in which two or more countries, often from different countries, join to undertake a major project

==Contract Manufacturing== - foreign country’s production of private-labeled goods to which a domestic company attaches brand name or trademark

==Common Market== - regional group of countries with common external tariff, no internal tariffs, and coordinated laws to facilitate exchange among members

==Ethonocentricity== - attitude that your own culture is superior to other cultures

==Outsourcing== - process whereby a firm contracts with other companies, often in other countries, to do some or all of its functions.

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Ethics

Society set standards for moral behavior.

• Business should be managed ethically because…
  • reduced likelihood of lawsuits by employees or customers
  • reduced employee turnover
  • businesses with good reputations attract customers
• Must communicate with outside parties/stakeholders such as CUSTOMERS when implementing new ethics program

==Compliance-Based Ethic Codes== - emphasizes preventing unlawful behavior by increasing control and penalizing wrongdoers

==Integrity-Based Ethic Code== - organization’s guiding values, creates environment that supports ethically sounds behavior, and stresses shared accountability

==Social Audit== - evaluate progress toward implementing socially responsible programs

Corporate Responsibility vs Policy → might not be completely accurate

• Responsibility includes anything having to do with acting responsibility within society (treating employees fairly) = concerns for welfare of society
• Policy refers to position firms take on social and political issues