Chapter 1 - The Study of BGS

Question 1

Sherman antitrust act of 1890

Answer 1

Created in response to Rockefellers monopoly in the oil business

Question 2

Define business

Answer 2

Profit making activity that provides products and services to satisfy human needs.

Question 3

Define Government

Answer 3

Structures and processes in society that authoritatively make and apply policies and rules.

Question 4

Define Society

Answer 4

A network of human relations composed of ideas, institutions, and material things.

Question 5

Define Value

Answer 5

And enduring believe about which fundamental life choices are correct.

Question 6

Define ideology

Answer 6

A bundle of values that creates a particular world view.

Question 7

Define institution

Answer 7

A formal pattern of relations that links people to accomplish a goal.

Question 8

How institutions support markets (image)

Answer 8

Pg 6

Question 9

Why is the BGS field important to managers?

Answer 9

To succeed in meeting it’s objectives a business must be responsive to both its economic and noneconomic environment.

Question 10

Social contract

Answer 10

An underlying agreement between business and society on basic duties and responsibilities business must carry out to retain public support. It may be reflected in laws and regulations.

Question 11

What are the four models of the BGS relationship?

Answer 11

1. The market capitalism model.
2. The dominance model.
3. The countervailing forces model.
4. The stakeholder model.

Question 12

Market economy

Answer 12

The economy that emerges when people move beyond subsistence production to production for trade, and markets take on a more central role.

Question 13

Capitalism

Answer 13

And economic ideology with a bundle of values including private ownership of means of production, the profit motive, free competition, and limited government restraint in markets.

Question 14

Market capitalism model

Answer 14

Business operates in a market environment, responding primarily to powerful economic forces. There it is substantially sheltered from direct impact by social and political forces. The market acts as a buffer between business and non-market forces.

Question 15

Laissez-faire

Answer 15

An economic philosophy that rejects government intervention in markets.

Question 16

The dominance model

Answer 16

The dominant model represents primarily the perspective of business critics. In it, business and government dominate the great mass of people. This is represented in a pyramid shaped hierarchy.

Question 17

Populism

Answer 17

A political pattern, recurrent in world history, in which common people who feel pressed for disadvantaged seek to take power from a ruling elite seen as thwarting fulfillment of the collective welfare.

Question 18

Marxism

Answer 18

And ideology holding that workers should revolt against property owning capitalists who exploit them, replacing economic and political domination with more equal and democratic socialist institutions.

Question 19

The countervailing forces model

Answer 19

The countervailing forces model depicts the BGS relationship as a flow of interactions among major elements of society. It suggests exchanges of power among them, attributing constant dominance to none.

Question 20

The stakeholder model

Answer 20

The corporation is at the center of an array of relationships with persons, groups, and entities called stakeholders.

Question 21

Primary stakeholders

Answer 21

Entities in a relationship with the corporation in which they, the corporation, or both or affected immediately, continuously, and powerfully. Examples include stockholders customers employees communities and governments.

Question 22

Secondary stakeholders

Answer 22

Entities in a relationship with the corporation in which the effects on them, the corporation, or both are less significant and pressing. Examples include earths biosphere religious groups unions media competitors future generations.