Ch.5 The Free Enterprise System Flashcards
Workers have the freedom to organize into a labor union while consumers have the freedom to purchase goods and services and to invest their money in banks or businesses.
Basic Principles
Encourages individuals to start and operate their own businesses without government involvement.
Free Enterprise System
A government-issued exclusive right to make, use, or sell an invention for up to twenty years.
Patent
A brand name, brand mark, trade name, trade character, or a combination of these elements that is given legal protection by the federal government.
Trademark
Involves anything that is authored by an individual and it gives the author the exclusive right to reproduce or sell the work.
Copyright
The sale price of a product. The assumption is that consumers will buy the product with the lowest price.
Price Competition
Competition based on factors that are not related to price, such as product quality, service and financing, business location, and reputation.
Non-price Competition
Exclusive control over a product or the means of producing it.
Monopoly
The money earned from conducting business after all costs and expenses have been paid.
Profit
The amount of goods producers are willing to sell.
Supply
A business that sells its products only in its own country.
Domestic Business
A business that sells its products to more than one country.
Global Business
A business that seeks to make a profit from its operations.
For-Profit Business
An organization that can function like a business but uses the money it makes to fund the cause identified in its character.
Non-Profit Business
Local, state, and federal government agencies and services, such as public libraries and state universities.
Public Sector
Businesses not associated with government agencies.
Private Sector
A group of establishments primarily engaged in producing or handling the same product or group of products or in rendering the same services.
Industry
The demand for industrial goods based on the demand for consumer goods and services.
Derived Demand
Includes: extractors, construction, manufacturing
Industrial Business
Channel of distribution that obtains goods from manufacturers and resells them to industrial users, other wholesalers, and retailers.
Wholesalers
Channel of distribution that buys goods from wholesalers or directly from manufacturers and resells them to the consumer.
Retailers
The five “rights” of merchandising are having…
- The right goods
- At the right time
- In the right place
- At the right price
- In the right amount
The business function of planning, organizing, and controlling all available resources to achieve company goals.
Management
A business function that involves money management.
Finance
The discipline that keeps track of a company’s financial situation.
Accounting
