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40 Cards in this Set
- Front
- Back
Simple definition-
Business |
Organization that provides goods or services to earn profits.
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Simple definition-
Profits |
Difference between a business's revenues and its expenses.
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Simple definition-
Domestic Business Environment |
The environment in which a firm conducts its operations and derives its revenues.
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Simple definition-
Global Business Environment |
The international forces that affect a business.
International Level: Trade agreements, international economic conditions, political unrest, etc.. Immediate Level: Suppliers, cultures, competitors, currency values. |
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Simple definition-
Technological Environment |
All the ways by which firms create value for their constituents.
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Simple definition-
Political-Legal Environment |
The relationship between business and government.
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Simple definition-
Sociocultural Environment |
The customs, mores, values, and demographic characteristics of the society in which an organization functions.
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Economic Environment |
Relevant conditions that exist in the economic system in which a company operates.
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Simple definition-
Economic System |
A nation's system for allocating its resources among its citizens.
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Simple definition-
Factors Of Production |
Resources used in the production of goods and services.
Labor, capital, entrepreneurs, physical resources, and information resources. |
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Simple definition-
Labor (Human Resources) |
Physical and mental capabilities of people as they contribute to economic production.
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Simple definition-
Capital |
Funds needed to create and operate a business enterprise.
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Simple definition-
Entrepreneur |
Individual who accepts the risks and opportunities involved in creating and operating a new business venture.
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Simple definition-
Physical Resources |
Tangible items organizations use in the conduct of their businesses.
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Simple definition-
Information Resources |
Data and other information used by businesses.
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List me:
Factors of Production |
Labor
Capital Entrepreneurs Physical Resources Information Resources |
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List me:
Dimensions of the External Business Environment |
Domestic Business Environment
Global Business Environment Technological Environment Political-Legal Environment Sociocultural Environment Economic Environment |
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Simple definition-
Planned Economy |
Economy that relies on a centralized government to control all or most factors of production and to make all or most production and allocation decisions.
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Simple definition-
Market Economy |
Economy in which individuals control production and allocation decisions through supply and demand.
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Simple definition-
Communism |
Political system in which the government own and operates all factors of production.
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Simple definition-
Market |
Mechanism for exchange between buyers and sellers of a particular good or service
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Simple definition-
Capitalism |
System that sanctions the private ownership of the factors of production and encourages entrepreneurship by offering profits as an incentive.
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Simple definition-
Mixed market Economy |
Economic system featuring characteristics of both planned and market economies.
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Simple definition-
Privitization |
Process of converting government enterprises into privately owned companies.
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Socialism |
Planned economic system in which the government owns and operates only selected major sources of production.
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Simple definition-
Demand |
The willingness and ability of buyers to purchase a good or service.
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Simple definition-
Supply |
The willingness and ability of producers to offer a good or service for sale.
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Simple definition-
Law of Demand |
Principle that buyers will purchase (demand) more of a product as its price drops and less as its price increases.
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Simple definition-
Law of Supply |
Principle that producers will offer (Supply) more of a product for sale as its price rises and less as its price drops.
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Simple definition-
Demand and Supply Schedule |
Assessment of the relationships among different levels of demand and supply at different price levels.
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Simple definition-
Demand Curve |
Graph showing how many units of a product will be demanded (bought) at different prices.
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Supply Curve |
Graph showing how many units of a product will be supplied (offered for sale) at different prices.
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Simple definition-
Market Price (Equilibrium Price) |
Profit-maximizing price at which the quantity of goods demanded and the quantity of goods supplied are equal.
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Surplus |
Situation in which quantity supplied exceeds quantity demanded.
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Simple definition-
Shortage |
Situation in which quantity demanded exceeds quantity supplied.
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Simple definition-
Private Enterprise |
Economic system that allows individuals to pursue their own interests without undue governmental restriction.
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List me:
The four elements of Private Enterprise |
1. Private Property Rights
2. Freedom of choice 3. Profits 4. Competition |
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Simple definition-
Perfect Competition |
Market or industry characterized by numerous small firms producing an identical product.
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What two conditions must be met in order for "Perfect Competition" to exist?
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Conditions:
1. All firms in an industry must be small. 2. The number of firms in the industry must be small |
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Simple definition-
Natural Monopoly |
Industry in which one company can most efficiently supply all needed goods or services.
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