Vocab
What is the definition of "Business"?
Business is the organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy society’s needs.
Why should you study business? In other words, how does studying business help you?
Assists you in choosing a career; Helps you become a better employee; Improve management skills; Start your own business; Become a better informed consumer and investor
What does "LLC" stand for?
Limited Liability Company
What is a Business Plan?
A comprehensive, written document acting as a strategic roadmap for starting, managing, and growing a business. A good business plan should include your companies goals, organizational structure, reasons that you stand out from the competition, marketing plans, and financial projections.
What are the 3 Pillars of CSR?
People, Planet, Profit
What is the definition of "Entrepreneur"?
Someone who works for themselves with the goal of planning, organizing, and launching a business. This person assumes the risk and responsibility involved in creating and running the business.
What is the difference between a Merchandising business and a Manufacturing business?
Merchandising: A business entity whose primary operation involves the buying and selling of finished goods.
Manufacturing: A business entity that produces finished goods from raw materials, labor and manufacturing overhead. The finished goods are sold to merchandisers, other manufacturers or even to direct consumers.
What is the difference between a General Partnership & a Limited Partnership?
General Partnership: A partnership in which all of the partners work together to manage the business.
Limited Partnership: A partnership in which at least one partner does not take part in the operation of the business.
List 3 characteristics of a successful entrepreneur.
Ability to set goals and follow through with them; Confidence in their ideas; Willingness to take responsibility for both successes and failures; Ability to learn from mistakes and overcome obstacles; A strong work ethic; A sense of responsibility to society
Why is it important to be ethical/act ethically?
Not everyone has the same belief about what is ethical and what is not ethical.
Individuals and organizations develop reputations based on their actions and the decisions they make.
What is the definition of "Business Ethics"?
Business ethics is the application of moral standards to business situations.
List 4 characteristics employers want to see from their employees.
Honest, Willing to work hard, Dependable, Manage time effectively, Self-confident, Motivated, Willing to learn, Professional, Communicative
List 2 pro's and 2 con's of owning a corporation.
Pros: Easy to get money to run the business by selling stocks and bonds; Directors of the corporation hire professional managers to run the business; Shareholders have limited liability; Continues to function even if the original owners are no longer part of the company; Transferring ownership of the corporation is easy
Cons: Difficult and expensive to get a charter to start the corporation; Owners (stockholders) have little power to affect the company; Company profits are taxed twice because the corporation pays taxes on profits and then shareholders pay income tax on dividends; More government rules than any other form of business
List 3 risks of entrepreneurship.
When you are self-employed you do not have a guaranteed paycheck; Lack of security as result of uncertainty about whether the business will succeed or fail; Long-term debt and loss of assets can be created with a failed business; If the business fails you will be unemployed
List 2 ways that CSR positively impacts people, businesses, and/or the community.
Philanthropic efforts support local communities; Fair labor practices ensure employee well-being; Environmental initiatives reduce carbon footprints; Community engagement fosters strong relationships; Ethical sourcing promotes sustainability and fairness; Transparency builds trust with stakeholders; Innovative solutions drive social impact; Education and awareness empower responsible choices
What is the definition of "Conflict of Interest"?
Conflict of interest occurs when a businessperson takes advantage of a situation for their own personal interest rather than the employer’s.
Why are businesses important to the U.S.? In other words, how do businesses help the U.S.?
Job creation, Innovation, Economic growth, Tax revenue, Consumer choice
What is the difference between Common Stock & Preferred Stock?
Common Stock: Allows one vote on major business decisions for each share of stock that is owned. Also allows shareholders to vote for board of directors.
Preferred Stock: Typically does not allow voting rights for directors. If the corporation goes out of business, owners of this stock get the leftover money before owners of common stock.
How do successful new businesses affect the economy?
They help the economy by creating income, reducing unemployment, paying government taxes, and creating new jobs.
What strategy might a company use to enhance their CSR initiatives?
Investing in Green Technologies; Supporting Local Communities; Promoting Ethical Consumption; Measuring Impact; Encouraging Employee Volunteerism; Advocating for Fair Trade Practices
What is the definition of "Corporate Social Responsibility"?
A business model that encourages companies to operate in ways that enhance society and the environment while still being accountable to their stakeholders and the public.
List 1 main innovation that resulted from each Industrial Revolution.
1: Steam & water power mechanize production in textile manufacturing, agriculture, the iron industry, and mining
2: The advent of electricity and the assembly line ushers in the era of mass production
3: Electronics, computers, and the internet automate production in a digital revolution
4: Data exchange, AI, and cyber-physical systems give humans new ways to interact with machines
There are 3 main steps to create a corporation. What are those steps?
1. Business incorporates (gain permission from the gov't & write a charter)
2. Sell company stocks
3. Shareholder vote
List the 5 steps to starting a new business.
1. Identify an opportunity
2. Create a business plan
3. Finance the business
4. File the paperwork
5. Open the business
What are the 4 guidelines that inform you if your behavior is ethical?
1. It is lawful.
2. It is consistent with company values and policies.
3. It is not intended to harm some so that others can benefit.
4. If the actions and results become public, it will not embarrass the company.