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Chapter 1
terms
48
Business
Undergraduate 1
01/15/2015

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Term

 

 

free enterprise

Definition

 

 

the system of business in which individuals are free to decide whatr to produce, how to produce it, and at what price to sell it.

Term
workplace diversity
Definition
differences among people in a workforce owing to race, ethnicity, and gender
Term
business
Definition
the organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy society's needs
Term
profit
Definition
what remains after all business expenses have been deducted from sales revenue
Term
stakeholders
Definition
all the different people or groups of people who are affected by an organization's policies, decisions, and activities
Term
economics
Definition
the study of how wealth is created and distributed
Term
microeconomics
Definition
the study of the decisions made by individuals and businesses
Term
macroeconomics
Definition
the study of the national economy and the global economy
Term
economy
Definition
the way in which people deal with the creation and distribution of wealth
Term
factors of production
Definition
resources used to produce goods and services
Term
entrepreneur
Definition
a person who risks time, effort, and money to start and operate a business
Term
capitalism
Definition
an economic system in which individuals own and operate the majority of businesses that provide goods and services
Term
invisible hand
Definition
a term created by Adam Smith to describe how an individual's personal gain benefits others and a nations economy
Term
market economy
Definition
an economic system in which businesses and individuals decide what to produce and buy, and the market determines quantities sold and prices
Term
mixed economy
Definition
an economy that exhibits elements of both capitalism and socialism
Term
consumer products
Definition
goods and services purchased by individuals for personal consumption
Term
command economy
Definition
an economic system in which the government decides what goods and services will be produced, how they will be produced, for whom available goods and services will be produced, and who owns and controls the major factors of production.
Term
productivity
Definition
the average level of output per worker per hour
Term
gross domestic product (GDP)
Definition
the total dollar value of all goods and services produced by all people within the boundaries of a country during a one year period
Term
inflation
Definition
a general rise in the level of prices
Term
deflation
Definition
a general decrease in the level of prices
Term
umemployment rate
Definition
the percentage of a nation's labor force unemployed at any time
Term
consumer price index (CPI)
Definition
a monthly index that measures the changes in prices of a fixed basket of goods purchased by a typical consumer in an urban area
Term
producer price index (PPI)
Definition
an index that measures prices that producers receive for their finished goods
Term
business cycle
Definition
the recurrence of periods of growth and recession in a nation's economic activity
Term
recession
Definition
two or more consecutive three-month periods of decline ni a country's GDP
Term
depression
Definition
a severe recession that lasts longer than a typical recession and has larger decline in business activity when compared to a recession
Term
monetary policies
Definition
Federal Reserve's decisions that determine the size of the supply of money in the nation and the level of interest rate
Term
fiscal policy
Definition
government influence on the amount of savings and expenditures; accomplished by altering the tax structure and by changing the levels of government spending
Term
federal deficit
Definition
a shortfall created when the federal government spends more in a fiscal year than it receives
Term
national debt
Definition
the total of all federal deicits
Term
competition
Definition
rivalry among businesses for sales to potential customers
Term
perfect (pure) competition
Definition

the market situation in which there are many buyers and sellers of a product, and no single buyer or seller is powerful enough to affect the price of that product

 

wheat

Term
supply
Definition
the quantity of a product that producers are willing to sell at each of various prices
Term
demand
Definition
the quantity of a product that buyers are willing to purchase at each of various prices
Term
market price
Definition
the price at which the quantity demanded is exactly equal to the quantity supplied
Term
monopolistic competition
Definition

a market situation in which there are many buyers along with a relatively large number of sellers who differentiate their products from the products of competitors

 

 

soap, clothing, furniture

Term
product differentiation
Definition
the process of developing and promoting differences between one's products and all competitive products
Term
oligopoly
Definition

a market (or industry) in which there are few sellers

 

automobile, airline, car rental, cereal, farm implement industries

Term
monopoly
Definition

a market (or industry) with only one seller, and there are barriers to keep other firms from entering the industry

 

public utilities, local gas, water, electricity

Term
standard of living
Definition
a loose, subjective measire of how well off an individual or a society is, mainly in terms of want satisfaction through goods and services
Term
barter
Definition
a system of exchange in which goods or services are traded directly for other goods or services without money
Term
domestic system
Definition
a method of manufacturing in which an entrepreneur distributes raw materials to various homes, where families process them into finished goods to be offered by sale by merchant entrepreneur
Term
factory system
Definition
a system of manufacturing in which all the materials, machinery, and workers required to manufacture a product are assembled in one place
Term
specialization
Definition
the seperation of a manufacturing process into distinct tasks and assignment of the different tasks to different individuals
Term
service economy
Definition
an economy in which more effort is devoted to the production of services than to the production of goods
Term
social media
Definition
the online interaction that allows people and businesses to communicate and share ideas ,personal information, and information about products or services
Term
sustainability
Definition
creating and maintaining the conditions under which humans and nature can exist in productivity harmony whie fufilling the social, economic, and other requirements or present and future generations.
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