Name 1 Intro to Business Review Unit 1 The Economy and You Ch 1 A Look at Needs and Wants Can be physically weighed and measured Tasks people or machines do for payment Individually owned Satisfied by businesses Skates, bikes, houses… Business: Provides and Answer Bank Goods goods Private Wants and Needs Shared by many people Satisfied by governments Roads, parks, education, shelter to make a . profit Public Wants and Needs Services services Ch 2 Economic Resources Factors of Production (means to produce goods and services) Raw materials in nature Become factors of production when used to produce goods. Knowledge, efforts, and skills people bring to work. Trucks, equipment, buildings, materials… Initiative to create new or improved goods and services. Economies of many countries are based on natural resources. Limited = non renewable Limited resources are also called Answer Bank Capital Resources Entrepreneurial Resources resources. Human Resources Natural Resources nonrenewable Name 2 Ch3 Economic Activity in a Changing World Economic Indicators: Reduces purchasing power of money Increase in prices Sometimes increased Country’s goods by downsizing and services (consumer, business, government, exports) Total amount gov owes Gov income (taxes) – gov expenses Negative: Budget deficit Positive: Budget surplus Business Cycle Peak of economic activity Slow down of economic activity Answer Bank Budget Deficit (or surplus) Depression GDP Gross Domestic Product Inflation Rate Deep recession Rise in business activity National Debt Prosperity Recession Recovery Unemployment Rate Name 3 Ch4 Business Ethics and Social Responsibility Laws Violation: business manager/owner could be Equal pay for equal work Protects consumers from dangerous or falsely advertised products Work related health and safety issues. Sweatshops Triangle Shirtwaist Co. 146 workers killed in fire in 1911 1970 Limit damage to environment (recycle, don’t pollute…) Men and women paid the same for equal work. (1964) : Strict guidelines developed by businesses to police themselves. Three questions to ask to determine if something is unethical:: 1) Is it 2) How would I feel if 3) Am I sacrificing Employee theft is not only all. Answer Bank against the law Code of Ethics Environmental Protection Agency EPA Equal Pay Act FDA fined or go to jail Food and Drug Administration increased ? ? for ? , it causes prices for long term benefits Occupational Safety and Health Administration OSHA short term gain someone did this to me wrong Name 4 Unit 2 Owning and Operating a Business Ch 6 Business Ownership and Operations Ownership Owned by one person Owned by two or more people Controlled by Board of Directors Bear complete risk. Share risks and responsibilities Owned by stock holders Limited liability Need corporate charter to run Other ways to do businesses Agreement to use the name and sell goods and services of an existing company. Main purpose is to provide a service instead of make a profit. McDonald’s Red Cross Private hospitals, museums, schools Don’t pay taxes Owned and operated by members for purpose of savings money on purchases or goods and services Ocean Spray Name 5 Types of Businesses Gathers raw materials Agriculture, mining, fishing, forestry Change raw goods into more finished products. Make finished products out of processed goods. Wheat to flour, iron into steel Bakery uses flour to bake bread, auto plant uses steel to make cars… Moves goods from one business to another. Buys, stores, then resells goods to wholesaler or retailer Answer Bank: Cooperative Corporation Franchise Intermediary Manufacturer Non Profit Partnership Processor Producer Service Business Sole Proprietorship Provides service instead of good. Hair styling, car repair… Name 6 money and in & the economy. Uses money for Name 7 Functions of Marketing Moving goods/services from one place to another (trucks, trains, planes, ships, online Business loans and credit to consumers Research people to market a product What to charge to make a profit. Distribution impacts pricing Name 8 Research opportunities to develop and maintain a product Make people aware of the product Retailers, business to business, relationship marketing Marketing Mix Is there a demand for this? Where to sell. (north, south…) Packaging to appeal to market. Kind of location. (fast food, sporting goods store…) Brand name, color, size. How much are customers willing to pay? Making customers aware of the product. Advertising. Is the price competitive? Discounts Name 9 6 Promote and sell product 7 Research—who are best customers? How were sales? Channels of Distribution Producer directly to consumer One or more intermediary Channel Members: Represents a single manufacturer Coca Cola Bottling Co. Receives large shipments from many different producers. Break shipments into smaller Sell directly to consumer Name 10 sides of buses reaches people on the move live internet show Cost: Newspaper/Magazines (number of readers) TV Audience size (national network vs local; time of day, event) Length (10-60 seconds) Frequency Internet “Per click” Size and format Size (inches) Location (cover, middle..) Answer Bank Banner Broadcast Media (Mass Media) circulation Cyber Ads (Internet) Direct Mail Directory effective expensive motion Outdoor Popup Print Radio Transit Webcasting Name 11 o o —price lower than cost, get you into the store. —Illegal: advertise low price of an item that the store doesn’t really have, with the intention to persuade you to buy a more expensive item. Where to buy: Macys (Marshall Field’s) Higher prices but better service WalMart Lower Prices because of quantity discounts, but fewer services TJ Max Minor flaws, over stock What to pay—Smart Consumer Different stores charge different prices for same item. FootLocker, Ace Large assortment of one product Name Read Read online 12 : Some are limited. : Are there complaints? Also, check the vs Name Brand: Is just as good? . Name 13 Ch 23 Consumer Rights and Responsibilities Consumer Bill of Rights, 1962, by Right to compare prices with competitors. illegal (antitrust laws) Right to report unsafe products or fraud such as “bait and switch” to FTC and other organizations. Businesses have Right to be informed of finance charges Right to be informed via labels: Food and Drugs list Ingredients in order of departments to handle consumer complaints Many businesses have comment cards for customer input. Labels list information such as Amount of fat, protein, calories, carbs… Right to have products to assure safety. Name 14 Three more rights added by the Consumer Movement: : Movement to pass laws to protect consumers from unfair and unsafe business practices. Return a product. If store refuses, write to manufacturer magazine in Pueblo, CO (now accessible online at http://publications.usa.gov/USAPubs.p hp Expect quality and respect claimed by the business Name 15 Ch 24 Protecting Consumers (p387) $25 - $5,000. Varies from state to state. Consumer Organizations: p.388-389 Nonprofit organization Collects information on local businesses. Oldest nonprofit consumer group 1899 Publishes Consumer Reports magazine National fraud info center Doesn’t recommend one company over another, but does publish complaints. Request Consumer Information Catalog of publications at their new website: http://publications. usa.gov/USAPubs.p hp or write to them at: Consumer Information Catalog Pueblo, CO 81009 Government Agencies p391 Enforces laws Inspects food Tests and approves food and drugs Tests cars for safety Name Enforce Antitrust laws to keep competition 16 Grades meat Orders recalls when necessary State Agencies p 391 : States issue these to prove qualifications: Doctors, teachers, roofers, hair stylists, architects and other professionals must pass a test to obtain one and practice in that state. Answer Bank: Better Business Bureau Consumer Information Center Consumers Union FDA Federal Trade Commission Food and Drug Administration FTC Licenses National Consumers League Natl. Hwy. Traffic Safety Administration NHTSA Small Claims Court US Dept of Agriculture USDA Name 17 Unit 9 Credit Ch 25 What is Credit? : Agreement to get money, goods, or services now in exchange for a promise to pay later. : Credit used by people for personal reasons : Credit use by businesses Name 18 : Short-term and medium-term credit offered by dealers or stores. : could be used for cash loans, but interest rate is high. : 15-30 year loan, usually for a house Answer Bank: Bank credit cards (Visa…) Charge Card Commercial Credit Consumer Credit Credit Mortgage Name 19 Don’t pay only the to avoid Answer Bank: capacity to pay credit limit finance charges finance charges minimum payment on a credit card bill. Instead, pay the entire amount due . Name 20 : Law that restricts amount of interest that can be charged : Person who has the job of collecting overdue bills. : Enforces laws on credit : Helps consumers with credit problems Name 21 Unit 10 Money Management Ch 28 Planning a Budget Most people want Take home pay (gross pay minus all deductions such as income and social security taxes) goods and services than they can buy with their money. Paycheck before taxes and other withdrawals Difference between budgeted amount and actual amount spent Part of budget to reach long term goals such as buying a car FICA Federal Insurance Contributions Act (social security tax) When estimating your income, don’t count on unusual income such as Instead, count only your regular income. . Name When estimating your expenses, plan for Answer Bank: Budget Variance gifts or tips Gross Pay increased prices more Net Pay Plan for savings 22 such as gas. Name 23 Ch 31 Investing in Stocks Share ownership of a corporation Preferred shareholders paid before Common shareholders. Common is more “common” Bought and sold at stock exchange Amount of money an investment earns. One year’s dividends divided by the cost. Answer Bank: Day Trading Mutual Fund Stock Stock Exchange Yield Where stocks are bought and sold Way to invest in stocks without buying stocks in a specific corporation Trade stocks based on minute-byminute changes in price.