Introduction to Business

What is a business?

• Activity that provides goods to consumers and making profit.

• Activity that focus on delivering services to consumers and making profit.

• Any activity that provides goods or services to consumers for the purpose of making a profit.

• Any activity that provides goods and services to consumers without generate profits.

___________ is the amount of revenue or income that a business owner retains after paying all the expenses associated with the operation of the business.

• Sale

• Profit

• Cost

• Debt

How do you define profit?

• when revenue exceeds cost

• when costs exceed revenue

• when revenue achieves planned target

• when the bottom line is in the red

How do you define loss?

• when costs fall lower than projection

• when the bottom line is in the black

• when revenue exceeds costs

• when costs exceed revenue

How do you define value?

• when the perception of competition is too expensive

• the perceived benefits by a customer of price to the time and money spent

• when market research establishes the floor price

• when a customer purchases for the lowest price in town

Which one is NOT TRUE about non-profit business?

• Generates revenues from sales and/or contributions

• Operated by board of directors, trustees, or managers

• Profits are not subject to taxation by local, state, and federal authorities

• Owned by individuals, partners, or shareholders

Which one is NOT TRUE about profit business?

• Incurs expenses for operations

• Generates revenues from contributions

• Profit is used to pay owners, partners, and shareholders

• Pays salaries to employees and managers

Factors of production are below, EXCEPT

• Entreprenurship

• Capital

• Equipment

• Labor

Which one is TRUE about management?

• Transforms resources into products

• Plans, organizes, controls, leads

• Plans, obtains and manages company funds

• Provides knowledge and ideas that help a company keep up and ahead of the competition

Which functional area of a business is responsible for converting the factors of production into goods and services?

• Management

• Marketing/Sales

• Operations

• Research and Development