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Chapter 1 What Is Business?
© 2016 Academic Media Solutions
Defining Business and Profit ◦ Key Concepts Businesses Profit Not-for-profit organizations Risk
Introduction
© 2016 Academic Media Solutions
© 2016 Academic Media Solutions
The Industrial Revolution and the Growth of the Factory System in the United States ◦ Key Concepts Factory system Specialization of labor
The Railroad Era ◦ Key Concepts Laissez-faire system Market domination Antitrust policies
The Evolution of Business in the United States (cont’d)
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The Assembly Line Era, Speculation, and the Great Depression
The Post-World War II Period: International
Institutions The Globalization Era
The Evolution of Business in the United States (cont’d)
© 2016 Academic Media Solutions
The New Society of Knowledge Workers ◦ Key Concepts New economy Knowledge workers
The Evolution of Business in the United States (cont’d)
© 2016 Academic Media Solutions
Economic Resources ◦ Scarce Land, Labor, Capital, and Technology
The Free Enterprise, or Capitalist, System ◦ Demand, Supply, and Price Theory or law of demand Price inelastic demand Price elastic demand Theory or law of supply Price inelastic supply Price elastic supply Market clearing, or equilibrium, price
Types of Economic Systems and Their Impact on Business
© 2016 Academic Media Solutions
© 2016 Academic Media Solutions
© 2016 Academic Media Solutions
The Free Enterprise, or Capitalist, System ◦ Demand, Supply, and Price (cont’d) Shortage Surplus ◦ Private Property and Property Rights
Types of Economic Systems and Their Impact on Business
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The Free Enterprise, or Capitalist, System (cont’d) ◦ Product Life Cycle Theory ◦ Degrees of Competition Market structure Pure competition Monopoly Imperfect competition Firm concentration ratios Barriers to competition Patents, Licensing, and tariffs
Types of Economic Systems and Their Impact on Business
© 2016 Academic Media Solutions
The Free Enterprise, or Capitalist, System ◦ Degrees of Competition (cont’d) Oligopoly Monopolistic Competition Product differentiation
Types of Economic Systems and Their Impact on Business (cont’d)
© 2016 Academic Media Solutions
© 2016 Academic Media Solutions
The Command, or Planned, Economic System ◦ Key Concept State enterprises
The Mixed Economic System ◦ Key Concept Privatization of State Enterprises
The Transition Economies ◦ From Command to Free Market System
Types of Economic Systems and Their Impact on Business (cont’d)
© 2016 Academic Media Solutions
How Economic Performance Is Measured ◦ Key Concepts Outputs Inputs Land Labor Entrepreneurs
Capital Money (financial capital) Capital goods (physical capital)
Technology
Production of Goods and Services
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Business Must Provide Value to Customers ◦ Not-for-Profit Public Broadcasting System National Public Radio State Universities ◦ Private Sector Investors Managers Employees Suppliers Society
Measuring Business Performance
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Maximizing Profit and Shareholder Wealth (cont’d)
Measuring Business Performance (cont’d)
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Measuring Consumer Confidence Consumer Confidence Index Conference Board Consumer Confidence Survey
The Consumer Knows Best Consumer Demographics and Psychographics ◦ Key Concepts Target group Market segmentation Psychographics
Cultural Diversity ◦ Key Concept Culture Diverse Workforce
Consumer Demand for Goods & Services
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Measuring Gross National Product (GNP), Gross National Income (GNI), and Gross Domestic Product (GDP) ◦ Key Concepts Consumption Investment Government expenditure Net exports
National Output of Goods and Services
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National Output of Goods and Services
The Components of U.S. GDP, 2012
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Measuring Gross National Product, Gross National Income, and Gross Domestic Product (cont’d) ◦ Key Concepts Nominal GNI, GNP, or GDP Real GNI, GNP, or GDP
Real National Output of Goods & Services
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Real GDP = Nominal GDP GDP deflator
Measuring Gross National Product, Gross National Income, and Gross Domestic Product (cont’d) ◦ Key Concepts Nominal GNI, GNP, or GDP Real GNI, GNP, or GDP
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Business Cycles
Demand for Goods and Services (cont’d)
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Innovations in Information Technology ◦ Key Concept Bandwidth Smartphones
E-Business ◦ Examples Alibaba.com Amazon.com ◦ Key Concepts B2C B2B
The Digital Era
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© 2016 Academic Media Solutions
Impact of IT on Globalization, Culture, Society, and Politics ◦ Helping developing countries A Better Life Foundation Social media
The Digital Era (cont’d)
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Private Versus Public and Not-for-profit Sector Functional Areas Include: ◦ Accounting ◦ Consulting ◦ Finance ◦ Information Systems ◦ International Business ◦ Management ◦ Marketing ◦ Supply Chain
Careers in Business
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Websites that focus on business careers include: ◦ Careers in Business ◦ Major Private Business Websites (Like Bechtel’s)
Careers in Business (cont’d)
© 2016 Academic Media Solutions