Koofers

(1) The Dynamics of Business and Economics - Flashcards

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Class:BUS 101 - Introduction to Business
Subject:Business
University:Grand Valley State University
Term:Winter 2011
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Business Individuals or organizations who try to earn a profit by providing products that satisfy people's needs.
Products A good or service with tangible and intangible characteristics that provide satisfaction and benefits.
Profit The difference between what it costs to make and sell a product and what a customer pays for it.
Nonprofit Organizations Organizations that may provide goods or services but do not have the fundamental purpose of earning profits.
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Stakeholders Groups that have a stake in the success and outcomes of a business.
Major Activities of Business 1) Management 2) Marketing 3) Finance
Economics The study of how resources are distributed for the production of goods and services within a social system.
Natural Resources Land, forests, minerals, water, and other things that are not made by people.
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Human Resources The physical and mental abilities that people use to produce goods and services; also called labor.
Financial Resources The funds used to acquire the natural and human resources needed to provide products; also called capital.
Economic System Description of how a particular society distributes its resources to produce goods and services.
Communism First described by Karl Marx as a society in which the people, without regard to class, own all the nation's resources.
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Socialism An economic system in which the government owns and operates basic industries but individuals own most businesses.
Capitalism, or Free Enterprise An economic system in which individuals own and operate the majority of businesses that provide goods and services.
Free-Market System Pure capitalism, in which all economic decisions are made without government intervention.
Mixed Economies Economies made up of elements from more than one economic system.
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Demand The number of goods and services that consumers are willing to but at different prices at a specific time. (measured by demand curve)
Supply The number of products---goods and services---the businesses are wiling to sell at different prices at a specific time. (measured by supply curve)
Equilibrium Price The price at which the number of products that businesses are wiling to supply equals the amount of products that consumers are willing to buy at a specific point in time.
Competition The rivalry among businesses for consumers' dollars.
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Pure Competition The market structure that exists when there are many small businesses selling one standardized product.
Monopolistic Competition The market structure that exists when there are fewer businesses than in a pure-competition environment and the differences among the goods they sell are small.
Oligopoly The market structure that exists when there are very few businesses selling a product.
Monopoly The market structure that exists when there is only one business providing a product in a given market.
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Economic Expansion The situation that occurs when an economy is growing and people are spending more money; their purchases stimulate the production of goods and services, which in turn stimulates employment.
Four Types of Competitive Environments 1) Pure Competition 2) Monopolistic Competition 3) Oligopoly 4) Monopoly
Inflation A condition characterized by a continuing rise in prices.
Economic Contraction A slowdown of the economy characterized by a decline in spending and during which businesses cut back on production and lay off workers.
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Recession A decline in production, employment, and income.
Unemployment The condition in which a percentage of the population wants to work but is unable to find jobs.
Depression A condition of the economy in which unemployment is very high, consumer spending is low, and business output is sharply reduced.
Gross Domestic Product (GDP) The sum of all goods and services produced in a country during a year.
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Budget Deficit The condition in within a nation spends more than it takes from taxes.
Manufacturing Economy One devoted to manufacturing goods and providing services rather than producing agricultural products.
Service Economy One devoted to the production of services that make life easier for busy consumers.
Entrepreneur An individual who risks his or her wealth, time, and effort to develop for profit or way of doing something.
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 BusinessIndividuals or organizations who try to earn a profit by providing products that satisfy people's needs.
 ProductsA good or service with tangible and intangible characteristics that provide satisfaction and benefits.
 ProfitThe difference between what it costs to make and sell a product and what a customer pays for it.
 Nonprofit OrganizationsOrganizations that may provide goods or services but do not have the fundamental purpose of earning profits.
 StakeholdersGroups that have a stake in the success and outcomes of a business.
 Major Activities of Business1) Management

2) Marketing

3) Finance
 EconomicsThe study of how resources are distributed for the production of goods and services within a social system.
 Natural ResourcesLand, forests, minerals, water, and other things that are not made by people.
 Human ResourcesThe physical and mental abilities that people use to produce goods and services; also called labor.
 Financial ResourcesThe funds used to acquire the natural and human resources needed to provide products; also called capital.
 Economic SystemDescription of how a particular society distributes its resources to produce goods and services.
 CommunismFirst described by Karl Marx as a society in which the people, without regard to class, own all the nation's resources.
 SocialismAn economic system in which the government owns and operates basic industries but individuals own most businesses.
 Capitalism, or Free EnterpriseAn economic system in which individuals own and operate the majority of businesses that provide goods and services.
 Free-Market SystemPure capitalism, in which all economic decisions are made without government intervention.
 Mixed EconomiesEconomies made up of elements from more than one economic system.
 DemandThe number of goods and services that consumers are willing to but at different prices at a specific time.

(measured by demand curve)
 SupplyThe number of products---goods and services---the businesses are wiling to sell at different prices at a specific time.

(measured by supply curve)
 Equilibrium PriceThe price at which the number of products that businesses are wiling to supply equals the amount of products that consumers are willing to buy at a specific point in time.
 CompetitionThe rivalry among businesses for consumers' dollars.
 Pure CompetitionThe market structure that exists when there are many small businesses selling one standardized product.
 Monopolistic CompetitionThe market structure that exists when there are fewer businesses than in a pure-competition environment and the differences among the goods they sell are small.
 OligopolyThe market structure that exists when there are very few businesses selling a product.
 MonopolyThe market structure that exists when there is only one business providing a product in a given market.
 Economic ExpansionThe situation that occurs when an economy is growing and people are spending more money; their purchases stimulate the production of goods and services, which in turn stimulates employment.
 Four Types of Competitive Environments1) Pure Competition

2) Monopolistic Competition

3) Oligopoly

4) Monopoly
 InflationA condition characterized by a continuing rise in prices.
 Economic ContractionA slowdown of the economy characterized by a decline in spending and during which businesses cut back on production and lay off workers.
 RecessionA decline in production, employment, and income.
 UnemploymentThe condition in which a percentage of the population wants to work but is unable to find jobs.
 DepressionA condition of the economy in which unemployment is very high, consumer spending is low, and business output is sharply reduced.
 Gross Domestic Product (GDP)The sum of all goods and services produced in a country during a year.
 Budget DeficitThe condition in within a nation spends more than it takes from taxes.
 Manufacturing EconomyOne devoted to manufacturing goods and providing services rather than producing agricultural products.
 Service EconomyOne devoted to the production of services that make life easier for busy consumers.
 EntrepreneurAn individual who risks his or her wealth, time, and effort to develop for profit or way of doing something.
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