Entrepreneurship

Mr. Bernstein

Entrepreneurship and the Economy, pp 6-9and

Basic Economic Concepts, pp 11-14

September 2015

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EntrepreneurshipMr. Bernstein

What is an Entrepreneur?• An individual who undertakes the creation,

organization, and ownership of a business• Examples?What is a venture?• A new business undertaking that involves risk• Examples?

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EntrepreneurshipMr. Bernstein

What is Entrepreneurship?• The process of recognizing an opportunity,

testing it in the market, and gathering resources necessary to go into business

What is Intrapreneurship?• The application of entrepreneurship within a

large organization

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EntrepreneurshipMr. Bernstein

What is Economics?• The study of how people choose to allocate

scarce resources to fulfill their unlimited wants

What is an Economic System?• A set of laws, institutions and activities that

guide economic decision making

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EntrepreneurshipMr. Bernstein

The Free Enterprise System: Capitalism• Individual Economic Freedom

– Individuals can choose what they wish to buy– Individuals can choose to own private property– Individuals can start business ventures and compete with other

businesses• Role of Competition

– Provides consumers choices– Forces businesses to improve quality and become more efficient– Reduces prices

• Also known as a Market Economy

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EntrepreneurshipMr. Bernstein

Market Structure: The Nature and Degree of Competition

• Monopoly• Oligopoly• Perfect Competition• Monopolistic Competition• Entrepreneurs are more likely to succeed in which

market structure(s)?

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EntrepreneurshipMr. Bernstein

Market Structure: The Nature and Degree of Competition

• List three companies that are in direct competition with each other.

• What are the products they use to compete?• What are the relative prices of the products?• In addition to product quality and price, in what

other dimension do the businesses compete?• Which product would you choose and why?

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EntrepreneurshipMr. Bernstein

Factors of Production• Land• Labor• Capital• Entrepreneurship• Which factor is generally in the shortest supply?• Can the supply of the Factors of Production effect

the overall economy?

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EntrepreneurshipMr. Bernstein

Supply and DemandEquilibrium Price:

Where Supply CurveMeets Demand Curve

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EntrepreneurshipMr. Bernstein

Supply and DemandEquilibrium Price:

Where Supply CurveMeets Demand Curve

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EntrepreneurshipMr. Bernstein

Supply and DemandIncrease in Demand:

Demand Curve shiftsand now meets Supply Curve at newEquilibrium

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EntrepreneurshipMr. Bernstein

Supply and DemandIncrease in Supply:

Supply Curve shiftsand now meets Demand Curve at newEquilibrium

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EntrepreneurshipMr. Bernstein

Supply and DemandElastic demand: As pricesrise or fall, demand changesInelastic demand: As pricesrise or fall, there is littleeffect on demand

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EntrepreneurshipMr. Bernstein

Supply and DemandRelationship between Supply, Demand, Price and ProductivityA rise in Productivity reduces costs and causes a rise in Supply

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EntrepreneurshipMr. Bernstein

Economic Indicators and the Business CycleGDP – measurement of total productivityUnderground economyBusiness Cycle and psychologyGovernment effect – Monetary and Fiscal policies