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Intro to Business
Exam #1
| Term | Definition |
|---|---|
| Business | Individuals or organizations who try to earn a profit by providing products that satisfy people´s needs. |
| Product | A good or service with tangible and intangible characteristics that provide satisfaction and benefits. |
| Profit | The difference between what it cost to make and sell a product and what a customer pays for it. |
| Human resources | The physical and mental abilities that people use to produce goods and services; also called labor |
| Supply | The number of products (goods and services) that businesses are willing to sell at different prices at a specific time. |
| Demand | The number of goods and services that consumers are willing to buy at different prices at a specific time. |
| Competition | The rivalry among business for consumers´ dollars. |
| Inflation | A condition characterized by a continuing rise in price. |
| 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. |
| Gross domestic product (GDP) | The sum of all goods and services produced in a country during a year. |
| Entrepreneur | An individual who risks his or her wealth, time, and effort to develop for profit an innovative product or way of doing something. |
| Business ethics | Principles and standards that determine acceptable conduct in business. |
| Social responsibility | A business´s obligation to maximize its positive impact and minimize it´s negative impact on society. |
| Code of ethics | Formalized rules and standards that describe what a company expects of its employees. |
| Corporate citizenship | The extent to which businesses meet the legal, ethical,economic, and voluntary responsibilities placed on them by their stakeholders. |
| International business | The buying, selling, and trading of goods and services across national boundaries. |
| Outsourcing | The transferring of manufacturing or other tasks (such as data processing) to countries where labor and supplies are less expensive. |
| Exporting | The sale of goods and services to foreign markets. |
| Importing | The purchase of goods and services from foreign sources. |
| Balance of trade | The difference in value between a nation´s exports and its imports. |
| Infrastructure | The physical facilities that support a country´s economic activities, such as railroads, highways, ports, airfields, utilities and power plants, schools, hospitals, communication system, and commercial distribution systems. |
| Import tariff | A tax levied by a nation on goods imported into the country |
| Quota | A restriction on the number of units of a particular product that can be imported into a country. |
| Embargo | A prohibition on trade in a particular product. |
| Dumping | The act of a country or business selling products at less than what it cost to produce them. |
| North America Free Trade Agreement (NAFTA | Agreement that eliminate most tariffs and trade restrictions on agricultural and manufactured products to encourage trade among Canada, the United State, and Mexico. |
| Licensing | A trade agreement in which one company (the licensor - allows anothercompany - the licensee) to use its company name, products, patents, brands, trademarks, raw materials, and/or production processes in exchange for a fee or royalty. |
| Franchising | A form of licensing in which a company provide a franchisee a name, logo, methods, advertising, products, and other elements in return for a financial commitment and the agreement to conduct business with the franchiser´s standard of operation. |
| Strategic alliance | A partnership formed to create competitive advantage on a worldwide basis. |
| Customer relationship management (CRM | A management philosophy according to which company´s goals can be best achieved through identification and satisfaction of the customers’ stated and unstated needs and wants. |
| Sole proprietorship | Business owned and operated by one individual; the most common form of business organization in the United State. |
| Partnership | A form of business organization defined by the Uniform Partnership Act as “an association of two or more persons who carry on as co-owners of a business for profit”. |
| Corporation | A legal entity, created by the state, whose assets and liabilities are separate from its owner. |
| General partnership | A partnership that involves complete sharing in both the management and the liability of the business. |
| Limited partnership | A business organization that has at least one general partner, who assumes unlimited liability, and at least one limited partner, whose liability is limited to his or her investment in the business. |
| Stock | Shares of a corporation that may be bought or sold. |
| Dividends | Profits of a corporation that are distributed in the form of cash payments to stockholders. |
| Private corporations | A corporation owned by just one or a few people who are closely involved in managing the business. |
| Public corporations | A corporation whose stock anyone may buy, sell, or trade. |
| Initial public offerings (IPO) | Selling a corporation´s stock on public markets for the first time. |
| Board of directors | A group of individuals, elected by the stockholders to oversee the general operation of the corporation, who set the corporation´s long-range objective. |
| Limited liability company (LLC | Form of ownership that provides limited liability and taxation like a partnership but places fewer restrictions on members. |
| Merger | The combination of two companies (usually corporations) to form a new company. |
| Acquisition | The purchase of one company by another, usually by buying its stock. |
| Entrepreneurship | The process of creating and managing a business to achieve desired objectives. |
| Small business | Any independently owned and operated business that is not dominant in its competitive area and does not employ more than 500 people. |
| Small Business Administration(SBA) | An independent agency of the federal government that offers managerial and financial assistance to small businesses. |
| Undercapitalization | The lack of funds to operate a business normally. |
| Business plan | A precise statement of the rationale for a business and a step-by-step explanation of how it will achieve its goals. |
| Intrapreneurs | Individuals in large firms who take responsibility for the development of innovations within the organizations. |
Created by:
Josefine Hippi
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