FINALS REVIEWER Flashcards
Examination Test - 2nd Semester
a French economist, came up with
the word entrepreneur.
- known for his theory Say’s Law of Demand, which states that production drives demand
Jean-Baptiste
Entrepreneurs in IT-related industries are more
commonly referred to as
Start-ups
The __________ governs entrepreneurs and businesses in the
Philippines. The agency is in charge of business
registration and trade policies.
Department of Trade and Industry (DTI)
also known as the Youth
Entrepreneurship Act, was passed in July 2015. The act aims to support the development of young individuals (18 to 30 years old) in the fields of finance
and entrepreneurship by integrating financial literacy
entrepreneurship programs in education curriculums.
Republic Act No. 10679
is a nonprofit organization that advocates
entrepreneurship in the country
The Philippine Center for Entrepreneurship
refers to two or more corporations
under the same ownership or parent company.
Conglomerate
Steps in sole proprietorship business registration in
the Philippines
- DTI - register business name
- Barangay - secure barangay clearance
- Municipality - get a business permit
- BIR (bureau of internal revenue) - apply for tax identification number (TIN); secure
authority to print receipts; have ledgers and invoices stamped. - SSS - apply as a self-employed owner.
Is the cost of borrowing
Interest
a business idea is a common issue that
hinders individuals from taking the entrepreneurial
route.
Financing
may be awarded to qualified
individuals under the Youth Entrepreneurship Act.
Grants and Loans
g is a term that describes solicitation
of funds and outsourcing services or ideas to people via the Internet.
Crowdsourcing
refers to the number of people passing
by the business.
Foot Traffic
is paid by entities that are exempt
from VAT, with gross annual sales not exceeding a
limit prescribed by the BIR, and subject to additional
guidelines S
Percentage Tax
is a tax on sale, lease, and importation of goods and services and is subject to additional guidelines.
The VAT rate is currently at 12%.
VAT
is imposed on the sale of capital
assets such as real estate properties and stocks. Real
estate tax is at 6%, while tax on gains from the sale of
stocks ranges from 5% to 10%.
Capital Gains Tax
is the most common tax filed by
employed and self-employed individuals or those who
derive their income from business or professional
practices. Personal income tax rates range from 20%
to 35% effective January 2018 as part of the Tax
Reform for Acceleration and Inclusion (TRAIN). T
Income Tax
Republic Act 10963
The Train Reform
Tax laws; fiscal policy; other
government rules and actions
POLITICAL
GDP; inflation and prices; interest
rate; forex; other economic indicators
ECONOMIC
Demography; lifestyle change and other
trends
SOCIAL
Technological advances;
research and new development; new processes
TECHNOLOGICAL
New and updated business requirements
LEGAL
Environment regulations;
resource constraints; climate change
ENVIRONMENTAL
refer to revisions on the implementation
and collection of taxes
Tax Reforms
is an example of excise tax imposed on goods
considered as vices such as alcohol and tobacco.
Sin Tax
Republic Act No.
10351
Sin Tax Reform Law
When government spending exceeds
revenue, the government runs into a
Budget Deficit
is when
government tax revenue is greater than spending
Budget Surplus
Its main responsibility is to maintain global monetary stability
through economic policy
International Monetary Fund (IMF)
leads the research on Philippine
socioeconomic data that is used in policymaking. The
same agency also monitors infrastructure projects
throughout the country.
National Economic and Development
Authority (NEDA)
Republic Act No. 9994
Expanded Senior Citizens Act of 2010
is a government entity under the
Department of Agriculture.
Phil Rice
was filed in November 2018,
seeking to ban the use of single-use plastics in the
country.
Senate Bill 1948
to minimize air
pollution by monitoring smoke-belching vehicles,
industrial plants, and wood or coal burning.
Republic Act No. 8749, Clean Air Act
was made
into law in 2004, much later than the Clean Air Act,
which was enacted way back in 1999. T
Republic Act No. 9275, Clean Water Act
was
signed into law in 2009. The act aims to evaluate
government programs to ensure that policies consider
the effects of climate change and new developments
are sustainable.
Republic Act No. 9729, Climate Change Ac
was signed in 2008. To emphasize the
importance of educating people.
Republic Act No. 9512, Environmental Awareness and
Education Act
includes industries in the business
of extracting raw materials from natural resources
Primary Sector
groups industries that process
raw materials into goods through manufacturing and
construction
Secondary Sector
covers the marketing and selling of
raw and manufactured products.
Tertiary Sector
s includes four
main industries: (1) mining and quarrying; (2) manufacturing; (3) construction; and (4)
electricity, gas, and water supply.
industry Sector
includes textile manufactures
and fabricated metal and steel products
Heavy Manufacturing
composed of relatively
easier-to-transport products such as household food
products and plastic products.
Light Manufacturing
It is characterized by the marketing and selling of products from the primary and secondary sectors. The Philippines has five main service industries: (1)
transport, storage, and communication; (2) trade and repair of motor vehicles,
motorcycles, and personal and household
goods; (3) financial intermediation, (4) real
estate, renting, and business activities; and (5) public administration, defense, and compulsory social security
Service Sector
refers to
the concentration of labor in the main sectors of the
economy. It requires a comparison of the number of
workers employed in the primary, secondary, and
tertiary sectors
Employment Structure of the Economy
is composed of institutions that are
privately owned.
Private Sector
is composed of government-owned
enterprises.
Public Sector
by private sector entities are goods
characterized by rivalry and excludability
Private Goods
means that a good consumed by an
individual cannot be consumed by another individual
or household
Rivalry
or exclusiveness means that paying
for a good or service prevents access by others who
have not paid for the good.
Excludability
Goods provided by the government are called
Public Goods
means that consumption or use
of a public good does not prevent other Individuals
from consuming or using the same good regardless if
they paid for it or not.
Nonexcludability
are characterized by excludability and
nonrivalry.
Club Goods
means that consumption or use does not
reduce the quantity of the goods available for others
Nonrivalry
are characterized by rivalry and
nonexcludability
Common Goods
Public goods are sometimes referred to as
Social or Collective Goods
__________ happen when consumption of a good affects another party
Externalities
lead to benefits to third parties.
The benefit to society is greater than personal benefit
Positive Externality
typically have positive externalities but
the benefits are often underestimated
Merit Goods
have negative externalities and
consumption of which causes harm to society
Examples include smoking and illegal drugs
Demerit Goods
is a standard industry classification
developed and primarily used in the financial market.
Global Industry Classification Standard
(GICS)
is the UN’s version of the
GICS. It is primarily used to measure and compare
economic activities across nations.
International Standard Industrial
Classification (ISIC)
The ______________ systems were established to fulfill the same
objective of having a standard for industry
comparisons.
Standard Industrial Classification (SIC)
and the North American Industry Classification
(NAIC)
is the country’s guide to
industry classifications based on business
productions.
The Philippine Standard Industrial
Classification (PSIC)
Barrier to entry evaluates the ease for new players to
penetrate an industry
Threat of New Entrants
means a high volume of production to
achieve a certain level of revenue.
Economy of scale
drives
operational costs and serves as a deterrent to new
players
Access to a wide distribution channel
the more unique the product
or service is, the less is the threat because it is harder
to take market share away from established brands
Product Differentiation
or require a large initial investment
deter new players.
Capital Intensive
may ease or restrict new players
from entering an industry.
Government Policies
is the second factor
that affects the level of competition among players in
the industry.
Bargaining Power of Suppliers
refers to the number of
suppliers in the industry. The higher the supplier
concentration, the weaker is the bargaining power of
suppliers.
Supplier Concentration
suppliers have high
bargaining power in a situation in which there are no
alternative inputs available.
Availability of Substitute Inputs
Suppliers that are
able to differentiate their products have higher
bargaining power
Supplier Power Differentiation
also influences
supplier power. A low switching cost means the
supplier’s bargaining power is also low.
Buyer’s switching cost to other inputs
impacts supplier powe
Process integration
means that a supplier takes on
the production process of the buyer it is supplying to.
Forward Integration
means that a buyer takes on the
procurement process or input production to displace
the need for suppliers.
Backward Intergration
Buyers pertain to end consumers, which means the
bargaining power of buyers points to the influence of
consumers on product prices in the industry
Bargaining Power of Buyers
The more buyers
in the industry, the less is the buyer’s bargaining
power and the greater is the competition.
Number of Buyers relative to Sellers
also influence buyer power. Low switching costs give
consumers greater bargaining power by enabling
them to switch products.
Switching costs and availability of substitute products
also influences the bargaining
power of buyers as much as it impacts supplier power
Process iNtegration
means that the
consumer decides to create the product that reduces
the potential for profit.
Backward Integration by Buyer
contributes to buyers’ bargaining
power. The higher the quaning demanded, the greater
is the bargaining power. This is commonly observed
in supermarkets.
Buyer’s Volune
Substitutes refer to goods or services that satisfy the
same consumer need as another good or service
Threat of Substitutes
