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34 Cards in this Set

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What is business?
Business is a goal directed behavior aimed at getting and using productive resources to buy, make, trade and sell goods that can be sold at a profit.
What are the 4 productive resources?
Land
Labor
Capital
Enterprise
Operating Costs
The costs of acquiring and using the 4 productive resources to make and sell goods and services.
Product
Any kind of good or service that other people value or want.
Value
How much utility a product gives customers; How well it satisfies
their desires or needs.
Price
A way of measuring the value of a product by how much customers are willing to pay for it.
Business Model
A company's plan of action to use resources to create a product that will give it a competitive advantage.
Competitive Advantage
A company's ability to offer customers a product that has more value to them than similar products offered by other companies.
Sales Revenues
The amount of money or income that a company generates from the sale of a product.
Profit
The total amount of money left over after operating costs have been deducted from sales revenues.
Capital
Profit that is kept in a company and invested in its business.
Wealth
The sum total of the resources, assets, riches and material possessions owned by people and groups in society.
Non-profit Organization
An Organization that is not in the business to make profit for stockholders but to provide value to the people and groups they serve.
What is a business system?
The combination of commerce, occupations, and organizations that result in the production and distribution of goods.
Business Commerce
Is the process through which people produce and then trade, barter or exchange valuable goods and services to better fulfill their wants and needs.
Trade
The exchange of products using money.
Barter
The exchange of one product directly for another.
What is Diminishing Marginal Utility?
The value we receive from additional units of an identical product declines as we possess or consume more of it.
What is the Law of Demand?
The principle that states as the price of a product rises, Consumers will buy less of it, and that as the price falls consumers will buy more of it.
What is the Law of Supply?
As the price of a product rises, producers will supply more of it, and as the price falls, producers will supply less of it.
Market
buyers and sellers for a particular product.
Market or Going Price
Happens when as much of a good is being supplied as people want to buy , so the price is neither increasing nor decreasing.
Industry
is a group of companies that make products that are similar or close substitutes for each other.
Profitability
A measurement of how well a company is making use of its resources relative to its competitors.
Premium Price
The higher a seller is able to charge versus what competitors can charge.
Specialization
The process by which people become more skilled and productive when they perform a narrowly defined range of tasks specific to an occupation or job.
Business Occupation
The acquired set of specialized skills that enable a person to create valuable goods and services that can be traded for a profit.
What is the Invisible Hand of the Market Principle?
That the pursuit of self-interest in the market place naturally leads to the improved well-being of society in general.
Monopoly
A situation in which one person or company controls the supply of a particular product and thus can charge an artificial high price for it.
Human Capital
A person's stock of knowledge, skills, experience, judgment, personality, and ability.
Transaction Costs
The costs of bargaining, negotiating, monitoring, and regulating exchanges between people in business.
Teamwork
A phenomenon that occurs when people pool their skills to create more valuable products than they could create alone.
What is Business Organization?
A tool that empowers people to shape and control the behavior of other people to produce goods and services.
Organizational Sructure
The framework of task and authority relationships that coordinates people so they work towards a common goal.