UAB BUS 102 - Test 1 Study Guide - Chapters 1-5 (Elizabeth Turnbull) 2024

Value - the relationship between the price of a good or service and the benefits that it offers its customers Business - any organization or activity that provides goods and services in an effort to earn a profit Profit - the money that a business earns in sales or revenue, minus expenses, such as the cost of goods, and the cost of salaries. Revenue - Expenses = Profit (or Loss) Loss - when a business incurs expenses that are greater than its revenue Entrepreneurs - people who risk their time, money, and other resources to start and manage a business Standard of Living - the quality and quantity of goods and services available to a population Quality of Life - The overall sense of well-being experienced by either an individual or a group Nonprofits - business-like establishments that employ people and produce goods and services with the fundamental goal of contributing to the community rather than generating financial gain Factors of Production - Four fundamental elements - natural resources, capital, human resources, and entrepreneurship - that businesses need to achieve their objectives Business Environment - the setting in which a business operates. 5 key environments: economic, competitive, technological, social, and global Business Technology - any tools - especially computers, telecommunications and other digital products - that businesses can use to become more efficient and effective E-commerce - business transactions conducted online, typically via the internet Demographics - the measurable characteristics of a population. Demographic factors: population size and density, age, gender, race, education, and income Discuss the role of business in the economy - Successful businesses create wealth, which increases the standard of living for virtually all members of society. Explain the evolution of modern business - The 5 distinct eras of United States businesses: industrial revolution, entrepreneurship era, production era, marketing era, and relationship era The Industrial Revolution - From the mid 1700s to the mid-1800s, technology field a period of rapid industrialization. Factory spring up and cities, leading to mass production and specialization of labor. The Entrepreneurship Era - During the second half of the 1800s, large-scale entrepreneurs emerged, building business empires that created enormous wealth, but often at the expense of workers and consumers. The Production Era - In the early 1900s, major businesses focused on further refining the production process, creating huge efficiencies. The assembly line, introduced in 1913, boosted productivity and lowered cost. The Marketing Era - After World War II, consumers began to gain power. As goods and services flooded the market, the marketing concept emerged: a consumer-first orientation as a guide to business decision making. The Relationship Era - With the technology boom in the 1900s, businesses began to look beyond the immediate transaction, aiming to build a competitive edge through long-term customer relationships. Discuss the role of nonprofit organization in the economy - Nonprofit organizations often work hand-in-hand with business to improve the quality of life in our society. Nonprofits our business like establishments that contribute to economic stability and growth. Similar to businesses, nonprofit generate revenue and incur expenses. Their goal is to use any revenue above and beyond expenses to advance the goals of the organization, rather than to make money for its owners.