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Question 1

Business

Answer 1

Any activity that seeks to provide goods and services to others while operating at a profit.

Question 2

Goods

Answer 2

Tangible products such as computers, food, clothing, cars, and appliances

Question 3

Services

Answer 3

Intangible products (that can’t be held in your hand) such as education, health care, insurance, recreation, and travel.

Question 4

Entrepreneur

Answer 4

A person who risks time and money to start and manage a business

Question 5

Revenue

Answer 5

The total amount of money a business takes in during a given period by selling goods and services.

Question 6

Profit

Answer 6

The amount of money a business earns above and beyond what it spends for salaries and other expenses.

Question 7

Loss

Answer 7

When a business’s expenses are more than its revenues.

Question 8

Risk

Answer 8

The chance an entrepreneur takes of losing time and money on a business that may not prove profitable.

Not all enterprises make the same amount of profit.
Businesses take risks, but with big risks could come big profits

Question 9

Standard of living

Answer 9

The amount of goods and services people can buy with the money they have.

The United States has one of the highest standards of living in the world.
Workers in other countries may make more money, but prices for products are higher.

Question 10

Quality of life

Answer 10

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.

High quality of life requires combined efforts of businesses, nonprofits, and government agencies.

Question 11

Stakeholders

Answer 11

All the people who stand to gain or lose by the policies and activities of a business and whose concerns the business needs to address.

A primary challenge is to recognize and respond to the needs of stakeholders.
circle flow chart of stakeholders

Question 12

Outsourcing

Answer 12

Contracting with other companies (often in other countries) to do some of the functions of a firm, like production or accounting.

Many foreign companies are opening offices and factories in the United States, which is called insourcing.

Question 13

Nonprofit organization

Answer 13

An organization whose goals do not include making a personal profit for its owners or organizers.

Nonprofit organizations use financial gains to meet social or educational goals.
Well known nonprofits
United Way 
American Heart Association
Salvation Army 
American Cancer Society
American Red Cross

Question 14

Factors of production

Answer 14

The resources used to create wealth.

The five factors:

1. Land (or natural resources)
2. Labor (workers)
3. Capital
4. Entrepreneurship
5. Knowledge

What makes rich countries rich today is entrepreneurship and knowledge.

Question 15

Business environment

Answer 15

The surrounding factors that either help or hinder the development of businesses.

1. Economic and legal environment
2. Technological environment
3. Competitive environment
4. Social environment
5. Global business environment

Businesses that create jobs and wealth grow and prosper in a healthy environment.

Question 16

GOVERNMENTS CAN LESSEN THE RISK of starting a business and increasing entrepreneurship and wealth by:

Answer 16

Minimizing spending and keeping taxes and regulations to a minimum.
Allowing private ownership of business.
Passing laws that enable businesspeople to write enforceable contracts.
Establishing a currency that is tradable in world markets.
Minimizing corruption in business and government.

Question 17

CORRUPT AND ILLEGAL ACTIVITIES

Answer 17

negatively affect the business community and the economy.

Question 18

The United Nations adopted ———- to end poverty and improve lives.

Answer 18

SUSTAINABLE DEVELOPMENT GOALS

Question 19

Technology

Answer 19

Everything from phones to computers and the various software programs that make business processes more effective, efficient, and productive.

Question 20

How Technology Benefits Workers and You

Answer 20

Effectiveness
Efficiency
Productivity

Question 21

Effectiveness

Answer 21

Producing the desired result.

Question 22

Efficiency

Answer 22

Producing goods and services using the least amount of resources.

Question 23

Productivity

Answer 23

The amount of output you generate given the amount of input (e.g., hours worked).

Question 24

E-commerce and its types

Answer 24

The buying and selling of goods over the Internet.
Business-to-consumer (B2C)
Business-to-business (B2B)

Question 25

Database

Answer 25

An electronic storage file for information.

Question 26

Identity theft

Answer 26

The obtaining of individuals’ personal information, such as Social Security and credit card numbers, for illegal purposes

Question 27

The Competitive Environment

Answer 27

Making quality products is not enough to stay competitive in world markets—now you have to offer quality products and outstanding service at competitive prices. Customers want good quality products at low prices with great customer service. Because business is more customer-driven, some managers give frontline employees more decision-making power.

Question 28

Empowerment

Answer 28

Giving frontline workers the responsibility, authority, freedom, training, and equipment they need to respond quickly to customer requests. It sometimes takes years to restructure an organization to empower numbers.

Question 29

Demography

Answer 29

The statistical study of the human population with regard to its size, density, and other characteristics such as age, race, gender, and income.

Question 30

The U.S. Equal Employment Opportunity Commission prohibits laws discriminating against:

Answer 30

Age
Disability
Genetic information
National origin
Pregnancy
Race
Religion
Sex

Question 31

The Global Environment

Answer 31

Two important environmental changes in recent years have been the growth of global competition and the increase of free trade among nations.

Question 32

War and Terrorism

Answer 32

They have drained trillions of dollars from the U.S. economy.
Money was diverted to the war effort.
Adds to the cost of insurance and security.
The threat of terrorism makes people more fearful and cautious and adds to business’ organizational costs.
Businesspeople benefit from a peaceful and prosperous world.

Question 33

How Global Changes Affect You

Answer 33

As businesses expand to serve global markets, new jobs will be created.
Rapid changes create a need for continuous learning.

Question 34

Climate change

Answer 34

The movement of the temperature of the planet up or down over time

Question 35

Greening

Answer 35

The trend toward saving energy and producing products that cause less harm to the environment.
Many companies say the evidence for climate change is overwhelming.
General Electric, Coca-Cola, Shell, Nestlé, DuPont, Johnson & Johnson, British Airways, Shanghai Electric

Question 36

Progress in the Agricultural and Manufacturing Industries

Answer 36

In the 1800s, the agricultural industry led economic development.
Technology, like the harvester and cotton gin, made large-scale farming successful.
This led to fewer farmers with larger farms.
Industrialization in the 19th and 20th centuries moved jobs from farms to factories.
As technology improved productivity, fewer workers were needed in factories.

Question 37

Progress in Service Industries

Answer 37

Services make up over 80 percent of the value of the U.S. economy.
Since the mid-1980s, the service industry generated almost all the increases in employment.
There are more high-paying jobs in service industries.

Question 38

Your Future in Business

Answer 38

We’re in the midst of an information-based global and technical revolution.