CHAPTER 1 Goods tangible products such as computers food clothing cars and appliances Services intangible goods such as education health care insurance recreation and travel and tourism Business any activity that seeks to provide goods and services to others while operating at a profit Entrepreneur a person who risks time and money to start and manage a business Revenue total amount of money a business takes in during a given period by selling goods and services Profit amount of money a business earns above and beyond what it spends on salaries and other expenses needed to run the operation Loss when a business s expenses are more than its revenues Risk the chance an entrepreneur takes of losing time and money on a business that may not prove profitable Those who take the most risk have more of a chance to make the most profit Standard of Living the amount of goods and services people can buy with the money they have Quality of Life the general well being of a society in terms of its political freedom natural environment education health care safety amount of leisure and rewards that add to the satisfaction and joy that other goods and services provide Stakeholders all the people who stand to gain or lose by the policies and activities of a business and whose concerns the business need to address Outsourcing contracting with other companies to do some or all the functions of a firm like its production or accounting tasks often in other countries Bad because it makes a lot of people lose jobs Nonprofit Organization organization whose goals do not include making a personal profit for its owners or organizers Nonprofit organizations often do strive for financial gains but they use them to meet their social or educational goals rather than for personal profit Factors of Production the resources used to create wealth land labor capital entrepreneurship and knowledge 5 factors of production 1 Land natural resources 2 Labor workers 3 Capital this includes machines tools buildings or whatever else is used in What makes rich countries rich today is the combination of entrepreneurship and the effective use of knowledge Business Environment the surrounding factors that either help or hinder the development of a business the production of goods 4 Entrepreneurship 5 Knowledge 1 The economic and legal environment 2 The technological environment 3 The competitive environment 4 The social environment 5 The global business environment Uniform Commercial Code regulates business agreements like contracts and warranties so tat firms know they can rely on one another Effectiveness producing the desires result Efficiency producing goods and services using the least amount of resources Productivity amount of output you generate given the amount of input such as the number of hours you work E commerce the buying and selling of goods over the Internet Database an electronic storage file for information Identity Theft the obtaining of individuals personal information such as SSN and credit card numbers for illegal purposes Competition has never been greater and most companies focus on making zero defects perfect products with no problems Empowerment giving frontline workers the responsibility authority freedom training and equipment they need to respond quickly to customer requests Demography the statistical study of the human population with regard to its size density and other characteristics such as age race gender and income Globalization World Trade Climate Change the movement of the temperature of the planet up or down over time Greening The trend toward saving energy and producing products that cause less harm to the enviroment
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