Intro To Business Study Guide

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Notes: Intro to Business
Chapter 1
. Drew Houston & Arash Ferdowsi- Drop box creators . Changs- Chinese restaurant owners

Represents the varied spectrum of businesses in the U.S.
Business- Entities that offer products to their customers in exchange for a profit
Profit- when a company’s revenue is greater than its expenses
Expenses- money a company pays out
Loss- Expenses > Revenue
Product- A good, or service
Good- Physical Products. (Cd, Roast-beef Sandwich, Cars, etc…)
Service- Intangible product that is bought/ sold. (Haircut, insurance, theatrical productions, etc…)
. Businesses provide employment, offer goods& services, generate income& spending > contribute to people’s quality of life.
Not for Profit- DOES NOT seek profit for owner. Services community through social, educational or political means. Any excess revenue is required to be used towards stated mission.
Factor of Production- Resources used to produce goods& services.
Labor- Human resource that refers to any physical/ intellectual work that people contribute to a business’s production.
I. Intellectual work- Ideas& knowledge contributed by employees
Natural Resources- The raw materials provided by nature used to provide goods& services.
I. Real Capital- Physical facilities used to produce goods& services (office buildings/ factories.)
II. Financial Capital- Money used to facilitate a business enterprise (Business Loans, investors, fundraising, personal savings)
Entrepreneurial Talent
I. Entrepreneur- person who assumes risk of creating, organizing& operating a business.
1. Entrepreneurs are similar to human resources, but they differentiate from this because they have the ability to bear risk& efficiently manage an enterprise.
Technology- Items& services such as computers and smartphones that make business more efficient& productive
. Changs and Dropbox started by created entrepreneurs determined to earn profit.
. Leroy Washington- Inherited Deli Cuban Sandwiches& Early Bird Special= Competition from Quiznos
Confronting Challenges Opportunity
Competition- Arises when 2+ businesses contend w/ one another to attract customers& gain an advantage
Competition forces companies to improve product offerings, lower prices, promote aggressively& focus on customer satisfaction.
Business> prove product is less expensive/ better than competitors in-order to turn a profit
Social Networking- A set of online services focused on building& supporting social relationships among people.
Employee Empowerment- Important/ Essential for a company to make workers feel free to deal w/ customer needs.
Employers seek workers who have interpersonal, communication& decision making skills.
Social Environment- An interconnected system of different demographic factors (race, ethnicity, age, gender, etc…)
Problems of aging population
I. Higher taxes
II. Reduction of government spending on programs such as social security& Medicare benefits
III. Higher federal budget deficit
Positive influences of an aging population
I. Allows certain businesses to grow (healthcare, pharmaceutical, and travel industries)
Green Economy- One that factors ecological concerns into business decisions
Multinational Enterprises- Companies that have operations in more than one country
Globalization- A movement toward a more interconnected& interdependent world economy
I. Offshoring- The relocation of production companies overseas, or subcontracting a portion of the components of products to foreign companies around the world, in order to maintain low