Exploring the World of Business and Economics (Chapter 1)

Business is defined as,

• a company, or group of people, authorized to act as a single entity and recognized as such in state and federal law

• the exchange of goods and services

• the exchange of goods and services between two or more people in a geographically delineated community

• the organized effort of individuals to produce and sell, for a profit, the goods and services that satisfy society’s needs

To be successful, a business must,

• be organized

• earn a profit

• satisfy needs

• all of those listed

To be organized, a business must combine four kinds of resources. The raw materials, buildings, and machinery that a business utilizes are examples of,

• financial resources

• human resources

• informational resources

• material resources

In a business, the people who provide labor in return for wages are classified as this type of resource.

• human resources

• financial resources

• informational resources

• material resources

The ability to pay employees and purchase the materials needed to operate a business is an example of,

• financial resources

• human resources

• informational resources

• material resources

In business, this resource is the ability to effectively organize and manage the other three resources a business needs to utilize if it wishes to be successful.

• financial resources

• human resources

• informational resources

• material resources

Often, businesses are categorized by their specific type/purpose. Businesses such as haircutters/salons, legal advice, and tax preparation offices are classified as,

• adverting businesses

• manufacturing businesses

• marketing intermediaries

• service businesses

The organized effort of individuals to produce and sell for a profit, the goods and services that satisfy society’s needs through the facilities available on the internet is known as,

• e-business

• e-economics

• e-mail

• e-transactions

In business, the primary objective of every firm and/or business is to,

• attract new clientele to the business

• ensure employees are paid on time

• make a profit

• satisfy the needs of its customers

In a successful business model, a business receives money (sales revenue) from its customers in exchange for goods or services. When the firm’s sales revenues are greater than its expenses it has,

• earned a profit

• experienced a loss

• experienced a negative profit

• experienced an exponential dividend