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107 Cards in this Set
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Individuals or organizations who try to earn a profit by providing products that satisfy people's needs. |
Business |
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A good or service with tangible and intangible characteristics that provide satisfaction and benefits. |
Product |
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The difference between what it costs to make and sell a product and what a customer pays for it. |
Profit |
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Organizations that may provide goods or services but do not have the fundamental purpose of earning profits. |
Non profit organizations |
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Groups that have a stake in the success and outcomes of a business. |
Stakeholers |
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Land, forests, minerals, water, and other things that are not made by people. |
Natural resources |
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The physical and mental abilities that people use to produce goods and services; also called labor. |
Human resources |
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The funds use to acquire the natural and human resources needed to provide products; also called capital. |
Financial resources |
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A description of how a particular society distributes its resources to produce goods and services. |
Economic system |
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First described by Karl Marx as a society in which the people, without regard to class, own all the nations resources. |
Communism |
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An economic system in which the government owns and operates basic industries but individuals own most businesses. |
Socialism |
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An economic system in which individuals own and operate the majority of businesses that provide goods and services. |
Capitalism(free enterprise) |
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Pure capitalism, in which all economic decisions are made without government intervention. |
Free-market system |
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Economies that have elements from more than one economic system. |
Mixed economies |
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The number of goods and services that consumers are willing to buy at different prices at a specific time. |
Demand |
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The number of products - goods and services - that businesses are willing to sell at different prices at a specific time. |
Supply |
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The price at which the number of products that businesses are willing to supply equals the number of products that consumers are willing to buy at a specific point in time. |
Equilibrium price |
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The rivalry among businesses for consumers' dollars |
Competition |
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The market structure that exists when there are many small businesses selling one standardized product. |
Pure competition |
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The market structure that exists when there are fewer businesses than in a pure-competition environment and the differences among the goods they sell are small |
Monopolistic competition |
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The market structure that exists when there are very few businesses are selling a product |
Oligopoly |
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The market structure that exists when there is only one business providing a product in a given market |
Monopoly |
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The situation that occurs when an economy is growing and people are spending more money; their purchases stimulate the production of goods and services, which in turn stimulates employment. |
Economic expansion |
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A condition characterize by a continuing rise in prices |
Inflation |
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A slowdown of the economy characterized by a decline in spending and during which businesses cut back on production and lay off workers |
Economic contraction |
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A decline in production, employment, and income |
Recession |
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The condition in which a percentage of the population wants to work but is unable to find jobs |
Unemployment |
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A condition of the economy in which unemployment is very high, consumer spending is low, and business output is sharply reduced |
Depression |
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The sum of all goods and services produced in a country during a year |
Gross domestic product (GDP) |
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The condition in which a nation spends more than it takes in from taxes |
Budget deficit |
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An individual who risks his or her wealth, time, and effort to develop for profit an innovative product or way of doing something |
Entrepreneur |
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Principals and standards that determine acceptable confuct in business |
Business ethics |
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A business's obligation to maximize its positive impact and minimize its negative impact on society |
Social responsibility |
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An identifiable problem, situation, or opportunity that requires a person to choose from among several actions that may be evaluated as right or wrong, ethical or unethical |
Ethical issue |
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Payments, gifts, or special favors intended to influence the outcome of a decision |
Bribes |
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Formalized rules and standards that describe what a company expects of its employees |
Code of eithics |
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The act of an employee exposing an employer's wrongdoing to outsiders such as the media or government regulatory agencies |
Whistleblowing |
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The extent of which businesses meet the legal, ethical, economic, and voluntary responsibilities places on them by their stakeholders |
Corporate citizenship |
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The activities that independent indiciduals, groups, and organizations undertake to protext their rights as consumers |
Consumerism |
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Conducting activities in a way that allows for the long-term well-being of the natural environment, including all the biological entities |
Sustainability |
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The sale of goods and services to foreign markets |
Exporting |
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The purchase of goods and services from foreign sources |
Importing |
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The difference in value between a nation's exports and its imports |
Balance of trade |
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A nation's negative balance of trade, which exists when that country imports more products than it exports |
Trade deficit |
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The difference between the flow of money into and out of a country |
Balance of payments |
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The physical facilities that support a country's economic activities, such as railroads, highways, ports, airfields, utilities and power plants, schools, hospitals, commercial distribution systems |
Infrastructure |
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The ratio at which one nation's currency can be exchanged for another nation's curreny |
Exchange rate |
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A tax levied by a nation on goods imported into the country |
Import tariff |
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Regulations that restrict the amount of currency that can be bought or sold |
Exchange controls |
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A restriction on the number of units of a particular product that can be imported into a country |
Quota |
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A prohibition on trade in a particular product |
Embargo |
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The act of a country or business selling products at less than what is costs to produce them |
Dumping |
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A group of firms or nations that agrees to act as a monopoly and not compete with each other, in order to generate a competitive advantage in world markets |
Cartel |
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A trade agreement, originally signed by 23 nations in 1947, that provided a forum for tariff negotiations and a place where international trade problems could be discussed and resolves |
General agreement on tariffs and trade (GATT) |
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International organization dealing with the rules of trade between nations |
World trade organizations (WTO) |
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Agreement that eliminates most tariffs and trade restrictions on agricultural and manufactures products to encourage trade among Canada, the United States, and Mexico |
North American Free Trade Agreement (NAFTA) |
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A union of European nations established in 1958 to promote trade among its members; one of the largest single markets today |
European Union (EU) |
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An international trade alliance that promotes open trade economic and technical cooperation among member nations |
Asia-Pacific economic cooperation (APEC) |
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A trade alliance that promotes trade and economic integration among member nations in Southeast Asia |
Association of Southeast Asian Nations (ASEAN) |
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An organization established by the industrialized nations in 1946 to loan money to underdeveloped and developing countries; formally known as the international bank for reconstruction and development |
World Bank |
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Organization established in 1947 to promote trade among member nations by eliminating trade barriers and fostering financial cooperation |
International Monetary Fund (IMF) |
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Foreign trade agreements that involve bartering products for other products instead of for currency |
Countertrade agreements |
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A firm that buys goods in one country and sells them to buyers in another country |
Trading Company |
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A trade agreement in which one company - the licensor - allows another company - the licensee - to use its company name, products, patents, brands, trademarks, raw materials, and/or production processes in exchange for a fee or royalty |
Licensing |
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A form of licensing in which a company - the franchiser - agrees to provice franchisee a name, logo, methods of operation, advertising, products, and other elements associated with a franchisers business in return for a financial commitment and the agreement to conduct business in accordance with the franchisers standard of operations |
Franchising |
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The hiring of a foreign company to produce a specifies volume of the initiating company's product to specification; the final product carries the domestic firms name |
Contract manufacturing |
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The relocation of business processes by a company or subsidiary to another country. Offshoring is different than outsourcing because the company retains control of the offshored processes. |
Offshoring |
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The sharing of the costs and operation of a business between a foreign company and a local partner |
Joint venture |
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A partnership formed to create competitive advantage on a worldwide basis |
Strategic alliance |
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The ownership of overseas facilities |
Direct investment |
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A corporation that operates on a worldwide scale, without significant ties to any one nation or region |
Multinational corporation (MNC) |
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A plan, used by international companies, that involves customizing products, promotion, and distribution according to cultural, technological, regional, and national differences |
Multinational strategy |
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A strategy that involves standerdizing products (and, as much as possible, their promotion and distribution) for the whole world as if it were a single entitiy |
Global strategy (globalization) |
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Businesses owned and operated by one individual; the most common form of business organization in the united states |
Sole proprietorships |
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A form of business organization defined by the Uniform parnership act as "An association of two or more persons who carry on as co-owners of a business for profit" |
Partnership |
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A partnership that involves a complete sharing in botht the management and the liability of the business |
General Partnership |
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A business organization that has at least one general partner who assumes unlimited liability, and at least one limited partner, whose liability is limited to his or her investment in the business |
Limited partnership |
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Legal documents that set forth the basic agreement between partners |
Articles of partnership |
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A legal entity, created by the state, whose assets and liabilities are separate from its owners |
Corporation |
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Shares of a corporation that may be bought or sold |
Stock |
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Profits of a corporation that are distributed in the form of cash payments to stockholders |
Dividents |
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A legal document that the state issues to a company based on information the company provides in the articles of inorporation |
Corporate Charter |
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A corporation owned by just one or a few people who are closely involved in managing the business |
Private Corporation |
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A corporation whose stock anyone may buy, sell, or trade |
Public corporation |
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Selling a corporations stock on public markets for the first time |
Initial Public Offering (IPO) |
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Corporations owned and operated by the federal, state, or local government |
Quasi-public corporations |
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Corporations that focus on providing a service rather than earning a profit buy are not owned by a government entity |
Nonprofit corporation |
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A group of individuals, elected by the stockholders to oversee the general operation of the corporation, who set the corporations long-range objectives |
Board of directors |
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A special type of stock whose owners, though not generally having a say in running the company, have a claim to profits before other stockholders do. |
Preferred stock |
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Stock whose owners have voting rights in the corporation, yet do not receive preferential treatment regarding dividends |
Common stock |
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A partnership established for a specific project or for a limited time |
Joint Venture |
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Corporation taxed as though it were a partnership with restrictions on sharholders |
S corporation |
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Form of ownership that provides limited liability and taxation like a partnership but places fewer restrictions on members |
Limited Liability Company (LLC) |
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An organization composed of individuals or small businesses that have banded together to reap the benefits of belonging to a larger organization |
Cooperative (co-op) |
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The combination of two companies (usually corporations) to form a new company |
Merger |
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The purchase of one company by another, usually by buying its stock |
Acquisition |
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A purchase in which a group of investors borrows money from banks and other institutions to acquire a company (or a division of one), using the assets of the purchased company to guarantee repayment of the loan |
Leveraged buyout (LBO) |
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The process of creating and managing a business to achieve desired objectives |
Entrepreneurship |
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Any independently owned and operated business that is not dominant in its competitive area and does not employ more than 500 peopl |
Small business |
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An independent agency of the federal government that offers managerial and financial assistance to small businesses |
Small business administration |
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The lack of funds to operate a business normally |
Undercapitalization |
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A precise statement of the rationale for a business and a step-by-step explanation of how it will achieve its goals |
Business plan |
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Persons or organizations that agree to provide some funds for a new business in exchange for an ownership interest or stock |
Venture capitalists |
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A license to sell another's products or to use another's name in business, or both |
Franchise |
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The company that sells a franchise |
Franchiser |
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The purchaser of a franchise |
Franchisee |
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Individuals in large firms who take responsibility for the development of innovations within the organizations |
Intrapreneurs |
