Mid Term Review Flashcards
What is the definition of business?
Business is any activity that provides goods or services to consumers for the purpose of making a profit.
For-profit?
Maximize/returns profits to owners
Nonprofit?
Directing any or all of the profits to a charitable cause, service, or organization.
What are the 4 factors of production?
Entrepreneur, Natural Resources, Labor/human capital, & Capital
What is an Entrepreneur?
A person who seeks to earn profits by knowing the risk of owning & running a business.
What is Natural Resources?
They’re found in nature & can be used for the production of goods/services.
What is Labor/human capital?
Human resources like working in a factory field.
What is Capital?
A resource that has been produced but is also used to produce other goods/services.
What are the key Functional Areas?
Management, Operations, Marketing/sales, Finance, Research & Development
Management?
Primary role of managers in business.
Planning?
Managers set long & short term goals.
Organizing?
Managers are responsible for organizing the operations of a business.
Controlling?
Large percentage of a managers time is spent controlling the activities.
Leading?
Managers serve as leaders for the organization.
What are Stakeholders?
Individual/ group that has a legitimate interest in a company.
What are Internal Stakeholders?
Groups/ people who work directly within business.
What are External Stakeholders?
Groups/ people outside a business who don’t work inside the business.
What is the Monetary Policy?
Policies that affect bank leading, interest rates, & financial capital markets.
What is the Fiscal Policy?
Government spending & taxes.
What is the definition of Economics?
Study of how humans makes choices under conditions of scarcity.
What is Scarcity?
NOT enough of something to satisfy everyone wants at a zero price.
What is the definition of Microeconomics?
Focuses on the actions of individual agents within the economy like households, workers, & businesses.
What is Economics of Scale?
A business finds that it’s production is becoming more efficient as it increases production.
What is Demand?
The Law of demand states that as the price of a good decreases the buyers desire to purchase more of it.
