Buisness: Any activity that seeks to provide goods and services to others while operating at a profit.
Profit: The amount a business earns above and beyond what it spends for salaries and other expense.
Entrepreneur: Aperson who risks time and money to start and manage a business.
Business don’t just make money for entrepreneurs. Business provide all of us with necessities such as food, clothing, housing, medical care and transportation, as well as other goods and services that make our lives easier and easier.
Revenue: the total amount of money a business takes in during a given period by selling goods and services.
Loss: when a business’s expenses are more than its revenue.
Risk: the chance an entrepreneur takes of losing time and money on a business that may not prove profitable.
Stakeholders: all the people who stand to gain or lose by policies and activity of a business.
Offshoring: sourcing part of the purchased inputs outside of the country.
Outsourcing: Assigning various functions, such as accounting, production, security, maintenance, and legal work to outside organizations.
Non-profit organization: An organization whose goals do not include making a personal profit for its owners or oranizers.
Social entrepreneurs are people who use business principles to start and manage non-profit organizations and help countries with their social issues.
Factors of production: the resources used to create wealth: land (or natural resources), labour (workers), capital goods (includes machines, tools, buildings, it does not include money ), entrepreneurship, and knowledge.
Business environment: the surrounding factors that either help or hinder the development of businesses.
1. The legal and regulatoy environment : Tax laws, contract laws, elimination of corruption
2. The economic environment : income and expenditurs, currency shifts, economic systems
3. The technological environment : information and technology, databases, the Internet
4. The competitive environment : components of competition, custoner-driven, organization structure
5. The social environment : diversity, demographic changes, family changes
6. The global environment
the legal and regulatory environment regulation: rules or orders made by government to carry out the purposes set out in statutes.
The technological environment
Technology: inventions or innovations from applied science or engineering research.
Productivity: the amount of output that is generated given the amount of input (e.g., hours worked).
Effectiveness means given period of time, the more money you are worth to companies. Efficiency means producing goods and services using the leastamount of resources.
E-commerce: the buying and selling of goods and services ouver the internet.
E-business: any information system or application that empowers business processes.
Database: an electronic storage file in which information is kept; one use of databases is to store vast amounts of information about customers. (scanner scan the bar code on the packaged goods.)
Identity theft: obtaining personal information about a person and using that information for illegal purpose.
Four ways government can foster entrepreneurship:
1. Keep taxes and regulations to a minimum.
2. Lessen the risks of entrepreneurship by passing laws that enable business people to write contracts tha are enforceable in court.
3. Setting laws to minimize corruption or other illegal activities
The competitive environment
Factors that drive competition( components of competition)
1. Entry: barriers to entry are business practices or conditions that make it difficult for new firms to enter the market. It can be in the form of capital requirements, product identity, distribution access, or switching costs. The higher the expense of the barrier, the more likely it will deter new entrants, and vice versa (e.g., barriers to exit)
2. Power of buyers and suppliers: powerful