Understanding Business–10th Edition–Chapter 1-4 Vocabulary

Flashcard maker : Lily Taylor
ethics
standards of moral behavior that is accepted by society as right VS wrong
compliance-based ethic codes
ethical standards that emphasize preventing unlawful behavior by increasing control and by penalizing wrongdoers
integrity-based ethic codes
ethical standards that define the organization’s guiding values, create an environment that supports ethically sound behavior, and stress a shared accountability among employees
whistleblowers
insiders who report illegal or unethical behavior
corporate social responsibility (CSR)
a business’s concern for the welfare of society
corporate philanthorpy
dimension of social responsibility that includes charitable donations
corporate social initiatives
enhanced forms of corporate philanthropy directly related to the company’s competencies
corporate responsiblity
the dimension of social responsibility that includes everything from hiring minority workers to making safe products
corporate policy
diminesion of social responsibility that refers to the position firm takes on social and political issues
insider trading
an unethical activity in which insiders use private company information to further their own fortunes or those of their family and friends
social audit
a systematic evaluation of an organization’s progress toward implementing socially responsible and responsive programs
business
Any activity that seeks to provide goods and services to others while operating at a profit.
profit
The amount of money a business earns above and beyond what it spends for salaries and other expenses.
entrepreneur
A person who risks time and money to start and manage a business.
revenue
The total amount of money a business takes in during a given period by selling goods and services.
loss
When a business’s expenses are more than its revenues.
risk
The chance an entrepreneur takes of losing time and money on a business that may not prove profitable.
Standard Of Living
The amount of goods and services people can buy with money they have.
Quality Of Life
The general well-being of a society in terms of political freedom, a clean natural environment, education, health care, safety, free time, and everything else that leads to satisfaction and joy.
stakeholders
All the people who stand to gain or lose by the policies and activities of a business.
Nonprofit Organization
An organization whose goals do not include making a personal profit for its owners or organizers.
Factors Of Production
The resources used to create wealth: land, labor, capital, entrepreneurship, and knowledge.
Business Environment
The surrounding factors that either help or hinder the development of business.
technology
Everything from phones and copiers to computers, medical imaging devices, personal digital assistants, and the various software programs that make business processes more efficient and productive.
productivity
The amount of output you generate given the amount of input (e.g., hours worked).
e-commerce
The buying and selling of goods over the internet.
database
An electronic storage file where information is kept; one use of databases is to store vast amounts of information about consumers.
empowerment
Giving frontline workers the responsibility, and freedom to respond quickly to customer requests.
demography
The statistical study of the human population with regard to its size, density, and other characteristics such as age, race, gender, and income.
goods
Tangible products such as computers, food, clothing, cars, and appliances.
services
Intangible products (i.e., products that can’t be held in your hand) such as education, health care, insurance, recreation, and travel and tourism.
outsourcing
assigning various functions, such as accounting, production, security, maintenance, and legal work to outside organizations
Climate Change
the movement of the temperature of the planet up or down over time
Greening
The trend toward saving energy and producing products that cause less harm to the environment
Identity Theft
the obtaining of individuals’ personal information, such as Social Security and credit card numbers, for illegal purposes
Economics
Study of how society chooses to employ resources to produce goods and services and distribute them for consumption among various competing groups and individuals
Macroeconomics
A part of economics that looks at the operation of a nation’s economy as a whole
Microeconomics
The part of economics that looks at the behavior of people and organizations in particular markets
Invisible Hand
A phrase coined by Adam Smith to describe the process that turns self-directed gain into social and economic benefits for all.
Capitalism
Economic system in which all or most of factors of production and distribution are privately owned and operated for profit
Supply
The quantities of products that manufacturers or owners are willing to sell at different prices at a specific time.
Demand
The quantity of products that people are willing to buy at different prices at a specific time.
Market Price
The price determined by supply and demand.
Perfect Competition
Market situation in which there are many sellers in a market and no seller is large enough to dictate the price of a product
Monopolistic Competition
Market situation in which a large number of sellers produce products that are very similiar but that are perceived by buyers as different
Oligopoly
A form of competition in which just a few sellers dominate the market
Monopoly
A market in which there is only one seller for a product or service.
Socialism
An economic system based on the premise that some, if not most, basic businesses should be owned by the government so that profits can be distributed among the people
Brain Drain
Loss of the best and brightest people to other countries
Communism
An economic and political system in which the state makes almost all economic decisions and owns almost all of the major factors of production.
Free-Market Economies
Economic system in which the market largely determines what goods and services get produced, who gets them, and how the economy grows.
Command Economies
Economic system in which the government largely decides what goods and services will be produced, who gets them, and how the economy grows.
Mixed Economies
Economic system in which some allocation of resources is made by the market and some by the government.
Gross Domestic Product (GDP)
The total value of final goods and services produced in a country in a given year.
Unemployment Rate
Number of civilians at least 16 years who have been trying to find a job within the prior four weeks.
Inflation
General rise in the prices of goods and services over time.
Deflation
A situation in which prices are declining
Business Cycles
Periodic rises and falls that occur in all economies over time.
Recession
Two or more consecutive quarters of decline in the GDP.
Depression
A severe recession.
Consumer Price Index (CPI)
monthly statistics that measure the pace of inflation or deflation
Disinflation
a situation in which price increases are slowing (the inflation rate is declining)
Fiscal Policy
The federal government efforts to keep the economy stable by increasing or decreasing taxes or government spending
Keynesian Economic Theory
The theory that a government policy of increasing spending and cutting taxes could stimulate the econemy in a recession.
Monetary Policy
The management of the money supply and interest rates by the federal reserve.
National Debt
The sum of government deficits over time.
Producer Price Index (PPI)
An index that measures prices at the wholesale level.
Resource Development
The study of how to increase resources and to create the conditions that will make better use of those resources.
Stagflation
A situation when the economy is slowing but prices are going up anyhow.
importing
buying products from oanoter country
exporting
selling products to another country
free trade
the movement of goods and services amon ations without political or economic barriers
comparative advantage theory
theory that states that a country should sell to tother countries those products that it produces most effectviely and efficiently and buy from other countries those products that it cannot produce as effectively/efficiently
absolute advantage
the advantage that exists when a country has a monopoly on producing a specific product or is able to produce it more effciently than all other countries
balance of trade
the total value of a nation’s exports compared to its imports measured over a particular period
trade surplus
a favorable balance of trade, occurs when teh value of a country’s exports that of its imports
trade deficit
an unfavorable balance of trade, occurs when the value of a country’s imports exceeds that of its exports
balance of payments
difference between money coming into a country (from exports) and money leaving the country (from imports) plus money flows from other factors such as tourism, foreign aid, military expenditures, and foreign investment
dumping
selling products in a foregin country at lower prices than those charged in the producing country
licensing
a global strategy in which a firm (the licensor) allows a foreign company (the licensee) to produce its product in exchange for a fee (royalty)
contract manufacturing
foreign country’s production of a private label goods to which a domestic company then attaches its brand name or trademark, part of the broad category of outsourcing
joint venture
a partnership in which two or more companies (often from different countries) join to undertake a major project
strategic alliance
long term partnership between two or more companies established to help each company build competitive market advantages
foreign direct investment (FDI)
buying of permanent property and businesses in foreign nations
foreign subsidiary
company owned in a foreign country by another company, called the parent company
multinational corportation
an organization that manufactures and markets products in many countries and has multinational stock ownership and multinational management
sovereign wealth funds (SWFs)
investment funds controlled by governments holding large stakes in foreign companies
exchange rate
value of one nation’s currency relative to the currencies of other countries
devaluation
lowering the value of a nation’s currency relative to other currencies
countertrading
a complex form of bartering in which several countries may be involved, each trading goods for goods or services for services
trade protectionism
the use of government regulations to limit the import of goods and services
tariff
a tax imposed on imports
import quota
a limit on the number of products in certain categories taht a nation can import
embargo
a complete ban on the import or export of a certain product, or stopping of all trade with a particular country
General agreement on tariffs and trade (GATT)
1948 agreement that established an international forum for negotiating mutual reductions in trade restrictions
World trade organization (WTO)
international organization that replaced the GATT and was assigned te duty to mediate trade disputes among nations
common market
regional group of countries that have common external tariff, no internal tariffs, and a coordination of laws to facilitate exchange, also called a trading bloc. (European Union)
North American free trade agreement (NAFTA)
agreement that created free trade area among US, Canada, and Mexico

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