Chapter 1: Business Fundmentals

Question 1

Goods

Answer 1

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

Question 2

Services

Answer 2

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

Question 3

Business

Answer 3

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

Question 4

Entrepreneur

Answer 4

Person who risks time and money to start and manage a business

Question 5

Revenue

Answer 5

Total amount of money received during a given period for goods sold and services rendered and from other financial sources

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

Occurs when a business’ expenses are more than its revenue

Question 8

Risk

Answer 8

Refers to the chance of loss, the degree or probability of loss, and the amount of possible loss

Question 9

Standard of living

Answer 9

Refers to the amount of goods and services people can buy with money they have

Question 10

Quality of life

Answer 10

Refers to the general well being of a society in terms of its political freedom, natural environment, education, health care, safety, and rewards that add to the satisfactions and joy that other goods and services provide

Question 11

Stakeholders

Answer 11

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

Stakeholders include: customers, stockholders, employees, dealers, bankers, anyone involved

Question 12

Offshoring

Answer 12

Entails sourcing part of the purchased inputs outside of the country

Question 13

Outsourcing

Answer 13

Means contracting with other companies to do some or all of the functions of a firm, such as producing or accounting

Question 14

Insourcing

Answer 14

Assigning various functions that could go to an outside organization to employees in the company

Question 15

Non profit organization

Answer 15

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

Question 16

Factors of production

Answer 16

The resources used to create wealth: land, labour, capital goods, entrepreneurship, and knowledge

Question 17

Land (or natural resources)

Answer 17

Used to make homes, cars, and other products

Question 18

Labour (workers)

Answer 18

People have been a valuable resource, although they’re being replaced by technology

Question 19

Capital goods

Answer 19

Includes machines, tools, building, or whatever else is used in the production of goods

(Does not include money!)

Question 20

Entrepreneurship

Answer 20

All the resources in the world ba e little value unless entrepreneurship are willing to take the risk or starting businesses to those resources

Question 21

Knowledge

Answer 21

Information technology has revolutionized business, making is possible to quickly determine wants and needs and to respond with desired goods and services

Question 22

What makes a country rich / two most valuable parts of factors of production

Answer 22

Combination of entrepreneurship and knowledge

Question 23

Business environment

Answer 23

The surrounding factors that either help or hinder the development of a business

Question 24

6 elements of business environment

Answer 24

1) the legal environment
2) the economic environment
3) the technological environment
4) the competitive environment
5) the social environment
6) the globe environment

Question 25

The legal environment

Answer 25

Tax laws
Contract laws
Elimination of corruption

Question 26

The economic environment

Answer 26

Income and expenditures
Currency shifts
Economic systems

Question 27

The technological environment

Answer 27

Information and technology
Databases
Internet

Question 28

The social environment

Answer 28

Diversity
Demographic changes
Family changes

Question 29

The competitive environment

Answer 29

Components of competition
Customer driven
Organizational structure

Question 30

Regulations

Answer 30

Consist of restrictions that provincial and federal laws place on your business with respect to the conduct of their activities

Question 31

Technology

Answer 31

Everything from phones to computers. Including apps, software, that make business more efficient, effective, and productive

Question 32

Effectiveness

Answer 32

Producing the desired result

Question 33

Efficiency

Answer 33

Producing goods and services using the least amount of resources

Question 34

Productivity

Answer 34

Amount of output you generate given the amount of input, such as number of hours you work

Question 35

E-commence

Answer 35

The buying and selling of goods and services over the internet

Question 36

E-business

Answer 36

Any information system or application that empowers business processes

Question 37

Database

Answer 37

Electronic storage file in which information is kept

Question 38

Identity theft

Answer 38

Obtaining an individuals perosnal information such as SSN and credit cards for illegal purposes

Question 39

Crowd surfing

Answer 39

Using the expertise of a large group to solve a business problem

Question 40

Empowerment

Answer 40

Giving front line workers the responsibility, authority, and freedom to respond quickly to customer requests

Question 41

Demography

Answer 41

Statstical study of the human population with regard to its size, density, and other characteristics (age, race, Income)

Question 42

5 factors of production (you must know this)

Answer 42

Land 
Labour 
Capital goods 
Entrepreneurship 
Knowledge 

KELL-C