Midterm Cheat Sheet - Summary Contemporary Business Practice PDF

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Midterm Cheat Sheet of first half of the year...

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A business is any profit-seeking organization that provides goods and services designed to satisfy the customers’ needs.Generating revenue isn’t enough; the business model must also indicate how the company is going to realize profit, the amount of money left over after expenses—all the costs involved in conducting the business—have been deducted from the revenue.Each company seeks a competitive advantage that makes its products more appealing to its chosen customers. Consumers benefit from better products and more choices, and companies get to focus on what they do best. Professionalism is the quality of performing at a high level and conducting oneself with purpose and pride. True professionals exhibit seven distinct traits: striving to excel, being dependable and accountable, being a team player, communicating effectively, demonstrating a sense of etiquette, making ethical decisions, and maintaining a positive outlook. Goodsproducing businesses create value by making “things,” from Pop-Tarts to school furniture to spacecraft. Most goods are tangible, meaning they have a physical presence; other goods, such as software, music downloads, and similar digital products, are intangible. Service businesses create value by performing activities that deliver some benefit to the customer, such as finance, insurance, transportation, construction, utilities, wholesale and retail trade, banking, entertainment, health care, maintenance and repair, and information. Twitter, Jiffy Lube, HBO, and Verizon Wireless are examples of service businesses. Many companies are both goods producing and service businesses.The relationship between risk and reward is fundamental to every modern economy. A company needs to see some promise of reward before it will decide to accept the risks involved in creating and selling products. However, to ensure responsible behavior, these risks need to stay attached to those decisions, meaning if a decision turns out to be bad, that company would suffer the consequences. The relationship between business and society is complex and far reaching. Individuals, communities, and entire nations benefit in multiple ways from the efforts of businesses, but even responsibly managed companies can at times have negative impacts on society in return.The economy is the sum total of all the economic activity within a given region, from a single city to a whole country to the entire world. The economy can be a difficult thing to get your mind wrapped around because it is so complex, constantly in motion, and at times hard to see— even though it’s everywhere around us.Economics is the study of how a society uses its scarce resources to produce and distribute goods and services. Economics is roughly divided into a small-scale perspective and a large-scale perspective. The study of economic behavior among consumers, businesses, and industries that collectively determine the quantity of goods and services demanded and supplied at different prices is termed microeconomics. The study of a country’s larger economic issues, such as how firms compete, the effect of government policies, and how an economy maintains and allocates its scarce resources, is termed macroeconomics. Each society must decide how to use its economic resources, or factors of production. Natural resources are things that are useful in their natural state, such as land, forests, minerals, and water. Human resources are people and their individual talents and capacities. Capital includes money, machines, tools, and buildings that a business needs in order to produce goods and services. Entrepreneurship is the spirit of innovation, the initiative, and the willingness to take the risks involved in creating and operating businesses. In a free-market system, individuals and companies are largely free to decide what products to produce, how to produce them, whom to sell them to, and at what price to sell them. In other words, they have the chance to succeed—or fail—by their own efforts. Capitalism and private enterprise are the terms most often used to describe the free-market system, one in which private parties own and operate the majority of businesses and where competition, supply, and demand determine which goods and services are produced.The broadest measure of an economy’s health is the gross domestic product (GDP). The GDP measures a country’s output—its production, distribution, and use of goods and services— by computing the sum of all goods and services produced for final use in a country during a specified period (usually a year)....