Introduction to Business

Chapter 1

• Profits are financial revenue gains exceeding expenses, costs, and taxes for maintaining a specific business activity.
• Factors of production entail resources used for producing goods and services; examples include land, capital, and labor.
• The study of economics involves studying people’s behavior, decisions, and reactions in difficult and successful situations.
• Economic systems include traditional, command, mixed, and market economies.
• The key economic indicators include gross domestic product (GDP), stock market, unemployment, consumer price index (CPI), producer price index (PPI), the balance of trade, housing starts, and interest rates (Voynarenko et al., 2019).
• Standard of living measures how well or poorly the population lives regarding meeting their basic needs.
• The national debt is the debt that the federal government owes the creditor.
• Monetary policy gets managed by the bank and considers interest rates and money supply circulation, while fiscal policy gets determined by government legislation that considers taxation and government expenditure.
• The market structure gets defined by different competition levels, including perfect competition, oligopoly, monopoly, and monopolistic competition.
• Equilibrium is a balanced supply and demand market state. Supply is the goods sold by producers. Demand is the number of goods consumers want to buy at different prices.
•  Voluntary economic activities in an economy where transaction gets conducted between sellers and buyers under private transactions

Chapter 2

• Ethics gets defined as a system of moral principles concerned with what is good for an individual and society.
• Beneficence, nonmaleficence, autonomy, and justice are the four ethical norms.
• Insider trading is trading stock illegally with the advantage of accessing confidential information.
• Whistleblowing involves reporting specific types of wrongdoings by workers
• Sarbanes-Oxley Law of 2002 developed to respond to the widespread corporate fraud and failures
• Social responsibility is the duty accorded individuals and corporates to act in environmental and social interests
• Obstructionist, defensive, accommodative, and proactive are the four stances to social responsibilities.
• The key stakeholders in business include employees, owners, suppliers, creditors, and the government.

Chapter 3

•  Small business has fewer employees and lower annual revenue, including a private corporation, partnership, or sole proprietorship. Their purpose is to provide entrepreneurs with opportunities and create jobs.
• The significant ways to start an organization involve doing market research, creating a business plan, financing the business, selecting a location, picking a business name, and registering the company.
• Success reasons for small businesses include well-defined vision, mastering budgets, networking, high standard leadership, and suitable investments. Failures of small companies involve poor marketing, poor communication with customers, failed future growth leveraging, and failure to adapt.
• An entrepreneur is an individual that develops and manages a company implementing their idea. Particular drive, strong communication, passion, constant learning, risk-taking, managerial and technical ability, and perseverance are the primary characteristics of entrepreneurs.
• A small business investment company (SBIC) gets licensing and regulation by the SBA and is a privately run investment fund.
• A formal business plan guides starting and managing a business
• Venture capital is private equity and funding given to startups and projected long-term growth potential businesses
• Sole proprietorship gets managed by its developer; the benefits and losses get incurred by the owner. Partnerships get run by two or more individuals that share profits and losses based on their contribution. C-corporations taxes the shareholders separately from the entity.
• S-corporation is a tax classification, whereas LLC is a business entity model.
• Merger/acquisition involves the combination of two separate entities to create a single organization.

Chapter 4

• Balance of payments is a specific economy’s international transactions over a specific duration, whereas the balance of trade gets defined as import and export differences in an economy over a particular duration.
• The ability to produce increased quantity with the similar input quantity than competitors is an absolute advantage. Comparative advantage involves producing commodities at a reduced opportunity cost than rivals. National comparative advantage lets a country produce at a low opportunity cost with a higher profit margin.
• Foreign currency questions entail seeking to understand the foreign financial market.
• Selling goods to foreign nation is exporting while purchasing foreign manufactured goods by domestic buyers is importing. Shipment from the U.S.A to get sold worldwide is export while shipment to get sold to the U.S.A as a foreign country as an import.
• Protectionist measures constitute protecting the domestic industry against foreign exploitation through subsidies, tariffs, and import quotas.
• Dumping entails exporting a product at a lower price in the foreign importing market than the high-priced exporter's domestic market.
• International market entry module is exporting, licensing, franchising, joint venture, foreign direct investment, and piggybacking.
• The world trade organization (WTO) is an international body that maintains global trade rules.