exam Flashcards
characteristics of an entrepreneur
f. r.o.g. s.h.a.c. i.v. m.p.
- self-confident
- perceptive
- hardworking
- motivated
- resourceful
- able to manage risk
- creative
- goal-oriented
- optimistic
- flexible
- independent
- visionary
- able to get along with others
skills of an entrepreneur
- interpersonal
- critical thinking
- creative thinking
- practical (Plan, organize, negotiate, network, keep records (financial and other)
what are the 5 p’s of international business?
- preference (reputation or countries specialize – belgian chocolate)
- promotion (how they promote their products)
- product (country’s resources determine what they sell – florida oranges)
- price (cost of production varies by country and influences where products are made)
- proximity (profitable for some businesses to sell products and services to consumers near a neighbouring country’s border)
what is offshoring
the practice of hiring service providers from countries where labour costs are lower to complete some or all of the steps in the production process.
Human rights issues
Labour abuses
what is balance of trade
relationship between the value of imports and the value of exports), countries try to import the same total value of products that they export.
imbalance in trade results in
- a trade deficit in which a country pays more for imports than it earns from exports
- a trade surplus in which a country earns more from exports than it pays for imports
trade surplus
where a country earns more from exports than it pays for imports.
trade deficit
where a country pays more for imports than it earns from exports.
accounts recievable
- asset (short term)
- total amount due from debtors
- from purchasing goods or services from the business on credit
Often due within 30 or 60 days
The “seller” will have an Accounts Receivable
accounts payable
- Liability (short term)
- total amount owed to creditors (people or businesses that we owe money to)
- for the purchase of goods or services on credit
Often due within 30 or 60 days
The “buyer” will have an Accounts Payable
revenue
- amounts of money earned from the sale of goods or services during the routine operation of the business
- revenue can be recorded from a promise of money (Accounts Receivable)
Fees Earned, Service Revenue, Sales Revenue
expenses
- the costs of items or services used up in the routine operation of the business
- can be recorded even if the business hasn’t paid for them yet (Accounts Payable)
Salaries, wages, advertising expenses, delivery expenses
net income
Net Income is the difference between revenue and expenses, when revenue is greater than expenses
- referred to as profit
net loss
Net Loss is the difference between revenue and expenses, when expenses are greater than revenues
types of leadership styles
autocratic
democratic
laissez-faire
autocratic
pros:
- May be valuable in some types of business where decisions need to be made quickly and decisively
- keeps everyone on track
cons:
- Can create de-motivation and alienation of staff
- doesn’t involve other people’s decisions
democratic
pros:
- Encourages decision making from different perspectives
- Improves the sharing of ideas and experiences within the business
cons:
- Can delay decision making
- accountability
laissez-faire
pros:
- Can be very useful in businesses where creative ideas are important
- Can be highly motivational, as people have control over their working life
cons:
- Can make decision making time-consuming
- no one gets anything done
What are the four main functions of management?
1) planning
2) controlling
3) leading
4) organizing
planning
setting goals and seeing how to achieve them
controlling
measuring performance and taking action to get desired results
leading
inspiring people to work hard to achieve high performance
organizing
arranging task, people, and other resources to accomplish work
marketing mix
4 p’s
2 c’s
4 p’s of marketing
- product
- price
- place
- promotion
4 p’s product
service done for customers
- Quality
- Design
- Features
- Benefits
- Service & Support
4 p’s price
the cost of an item
- Perception of the product’s value in relation to price
- Cover costs and make a profit
4 p’s place
Where the product will be sold
- How the product / service will get to the consumer
4 p’s promotion
How will customers be made aware of the product or service
advertising, personal selling, sales promotion (coupons, contests, premiums, samples, and special events), sponsorship
2 c’s
competitive market
consumer market
competitive market
other businesses that have similar products and compete with us for consumer dollars
Direct Competition
- other sellers of products similar to ours
Indirect Competition
- other spending needs that may draw customer dollars away from our products
consumer market
The type of consumers who buy their products.
- Demographics
age, gender, family, life cycle, income, ethnicity and culture - Lifestyle
values, beliefs and motivations
2 main roles of marketing
- To sell what a business makes
2. To manage the business brand
3 components to branding
- Brand Name
- Logo or Trademark
- Slogan
brand names
a word or group of words that a business uses to distinguish its products from competitors products.
Brand names should:
- Be distinctive and stand out from the competition
- Be easy to remember
logo or trademark
A special symbol that is associated with a product.
- It helps a product compete for consumer awareness
slogan
A short catchy phrase that is usually attached to the company’s name and logo.
logos can be 1 of the 3
1) monogram
2) visual symbols
3) abstract symbols
branding
Once a company develops a name, slogan, or logo for a product, everything associated with that product should carry the identification.
Instant recognition and market appeal
difference between an invention and innovation
invention - A product or process that does something that has never been done before. When the invented product or service fills a need, it can potentially be sold to consumers.
Innovation - An innovation requires using new technology, materials or processes to improve existing products or services or to create new production and distribution processes.
what are wants?
things that are more extra in your life. you don’t need them to survive but they make your life more pleasant.
ex: phones, cars, designer clothes
what are needs?
things you must have in order to stay alive.
ex: food, water, shelter, clothes
what is supply?
the quantity of a good or service that businesses are willing and able to provide within a range of prices that people would be willing to pay
as prices increase, producers will increase the quantity of goods they provide.
what is demand?
the quantity of goods or service that consumers are willing and able to buy at a particular price
as the price of a good increases, quantity demanded decreases.
what is Maslow’s Hierarchy of Needs?
a theory of human motivation. he developed a hierarchy of needs. once lower needs are met, people move onto the next needs.
- needs are their motivators
label the Maslow pyramid:
top to bottom (small to big)
level 5: self actualization level 4: esteem needs level 3: belongingness and love needs level 2: safety needs level 1: biological and physiological needs
example of physiological needs:
- oxygen
- water
- food
- sleep
example of safety needs:
- free from abuse
- security
- law
example of love needs:
- acceptance
- dating
- sense of love
example of esteem needs:
- status
- responsibility
- reputation
example of self actualization needs:
- personal growth
- fulfilment
- self aware
what is a whistleblower?
when an employee informs officials/public about an illegal or ethical violation. they make their allegations internally or externally.
what is ethical dilemma?
a moral problem with a choice between potential right and wrong.
ethical code of conduct
a document that explains specifically how employees should respond in certain situations. helps different people approach problems the same way.
3 c’s of credit
- Character
- Capacity
- Capital
character
Individual financial personality
capacity
Ability to repay debt on time
capital
Financial value or worth of the person – assets used to repay debt
what is a credit rating
- Information is collected on both individuals and businesses for a period of seven years
- Keep track of defaults (debt that has gone unpaid for so long that the creditors wonder if they money will ever be paid back)
why is credit rating important
- Indicates the level of risk that a consumer, business, or government will pose if credit is granted by a business
- Bad credit rating can get you denied for a car loan or a landlord may refuse to rent to you or pay higher interest rate
how do you establish a credit rating (3 ways)
Students:
- Getting and keeping a job
- Buying something on credit (with credit card) and paying it off before interest is charged
- Having someone, such as a family member or close friend with a good credit rating, co-sign a loan or name on parent’s credit card
adv and disadv of credit
adv
- instant enjoyment (i.e. car purchase)
- credit rating
- monthly statement, reward points
- convenience
- emergency needs
disadv
- credit costs
- impulse buying
- overbuying
- financial difficulties
schedule 1
- Owned by Canadian Shareholders
- Shares traded on Canadian stock exchanges
- Accepts deposits, offer investment & financial services
Think Big Five – RBC, TD, CIBC, BMO, ScotiaBank
schedule 2
- Mostly foreign-owned banks
- Typically not traded publicly
- Federal government limits number of branches
Examples: HSBC Bank of Canada, State bank of India, ING Bank of Canada, AMEX Bank of Canada, etc.
schedule 3
- Foreign bank branches given permission to operate in Canada
- Work under certain restrictions
Examples: Deutsche Bank AG, Citibank, Capital One Bank, etc.
imports
goods coming into the country from other countries
exports
goods leaving a country for another country’s market place
credit bureau
a company that collects information relating to the credit ratings of individuals and makes it available to credit card companies and financial institutions
fixed expenses
Expenses that occur monthly and don’t vary
Examples: mortgage, car loan, insurance
variable expenses
Expenses that occur that vary each month (or do not occur at all)
Examples: some utilities, clothing, entertainment, food
liquidity
how fast assets can be converted in to cash
ethics and corporate social responsibility
being a good person and making the right decisions in the corporate world
co-sign
if you sign something (house, credit card) you need someone to co-sign fo you
whoever your co-signer is has liability over your credit card and has to pay the bills
- have to have a good credit rating to co-sign
forms of income
- gross income
- net income
- discretionary income
mortgage
a specific loan for a house
discretionary income
the amount of an individual’s income that is left for spending, investing or saving after paying taxes and paying for personal necessities, such as food, shelter and clothing
- includes money spent on luxury items, vacations, and nonessential goods and services
how can entrepreneurship change your life?
- You become more accountable
- You think critically about everything
- You embrace criticism and feedback
- You’re more confident in your abilities
- You take more risks
How ethics impacts you and business?
Ethical business practices can help companies avoid legal problems and negative financial results that arise once the unethical behaviour is discovered
- can help save your reputation
what affects demand
- Change in consumers’ income
- Change in consumers’ tastes
- Changes in what we expect in the future
- Change in population
- Change in the price of a substitute
what affects supply
- A change in the number of producers
- Price of related goods
- Change in technology
- Change in cost of production
- Weather
what is surplus
Surplus occurs when there is excess supply- that is quantity supplied is greater than quantity demanded.
(i.e. Fidget spinners)
what is shortage
Shortage occurs when there is excess demand- that is quantity demanded is greater than quantity supplied.
(A fad at Christmas)
