Business Basics
This is the easiest type of business to start, but it has unlimited liability.
Sole proprietorship
-A one-owner business; simple to set up but risky because the owner is personally responsible for all debts.
When workers refuse to work until demands are met, it’s called this.
Strike
-A labor protest where employees stop working to pressure their employer.
Government taxing and spending to influence the economy.
Fiscal Policy
-Congress changing taxes or spending to boost or slow down the economy.
This measures inflation by tracking prices of consumer goods.
Consumer Price Index (CPI)
-An economic tool that shows how much everyday prices are rising and falling.
Businesses are responsible to these four groups.
Consumers, Owners, Employees, and the Community/Government?
-Companies must treat all of these groups fairly and ethically.
These are the owners of a corporation’s shares.
Stockholders
-People who invest money into a corporation and, in return, own part of the company.
This state law prevents mandatory union membership.
Right-to-work law
-A law saying workers cannot be forced to join a union as a condition of employment.
Buying and selling government securities to affect the money supply.
Open Market Operations
-The Federal Reserve buys or sells government bonds to control how much money is in circulation.
Economists prefer this measure of GDP because it accounts for inflation.
Real GDP (GROSS DOMESTIC PRODUCT)
-GDP adjusted to remove inflation so we see actual growth.
Two responsibilities businesses have to consumers are ________ and ________.
Safe products and Honest advertising
-Businesses should not harm customers and must give truthful information.
This government document officially creates a corporation.
What is a charter?
-A legal paper from the state that gives a corporation permission to exist.
The two main types of unions are ________ and ________.
Trade unions and Industrial Unions
-Trade unions represent workers in one job or skill; industrial unions include all workers in an industry.
If the Fed raises the reserve requirement, banks will do this.
Lend LESS
-Banks must keep more money in reserve, so they can’t loan out as much.
This phase of the business cycle involves falling GDP and rising unemployment.
Recession
-A slowdown in the economy when fewer goods are produced and jobs are lost.
This means making financial data available to the public.
Transparency
-Being open and clear about business finances so investors can make informed decisions.
In this business structure, members collectively own and operate it for shared benefit.
Cooperative
-A business owned by the people who use its services (like farmers or small businesses working together)
This federal agency helps settle disputes between unions and businesses.
National Labor Relations Board
-A government group that resolves conflicts and ensures fair labor practices.
This is the U.S.'s central bank
Federal Reserve
-The nation's main bank that manages money supply and interest rates. Bank of all banks.
Stockholders are most affected by this issue because they are taxed twice.
Double taxation
-Corporations pay taxes on profits, and then shareholders pay taxes again on dividends.
Social responsibility in business is this. Give one example.
The duty to benefit society (ex: donating to schools, protecting the environment)
-Going beyond profits to help the community and environment.
In this type of liability, owners are fully responsible for all business debts.
Unlimited liability
-The owner must personally pay any business debts, even with their own money or property
This third-party decision in a dispute is binding on both sides.
Arbitration
-When a neutral outsider makes a final decision that both the union and business must accept.
Which U.S. government group releases unemployment rate data?
Bureau of Labor Statistics
-A federal agency that tracks jobs, wages, and unemployment numbers.
List the three tools of the Federal Reserve.
Discount rate, reserve requirement, open market operations
-The Fed adjusts interest rates, bank reserves, and bond buying/selling to influence the economy.
What percentage of workers must vote in favor of a union before it can form?
50% + 1 (A MAJORITY)
-More than half of workers must agree before a union is created.