Topic 1. Principles of business economy

Companies add value in the transformation process. We can calculate the value by...

• ADDED VALUE = OUTPUTS - INPUTS VALUE

• ADDED VALUE = INPUTS - OUTPUTS VALUE

• ADDED VALUE = INPUTS + OUTPUTS VALUE

• ADDED VALUE = OUTPUTS + INPUTS VALUE

What is a socially responsible business following the "hybrid spectrum"?

• Companies with our profit-making motive

• Companies with profit making motive including responsible practices

• Companies in which income is reinvested in social programs

• The profits are redistributed into social practices

Why are companies considered as a system?

• Because are a set of interdependent elements or subsystems, whose relationships are shaped by an structure, to achieve an objective

• Because it is concerned with the efficient allocation of scarce resources.

• Because they have greater emphasis on market research than on the company’s operation.

• Because it is Is focused on understanding when and why the market is more efficient in allocating resources

How can a firm be classified following the economic criteria "by scope"?

• Primary production

  Secondary production

  Tertiary production

• Public / State owned companies

  Private companies

• Micro, small, medium-sized (SMEs) and large companies

• Nationals

  Internationals

Who is the entrepreneur according to Schumpeter...?

• Controls and organises: agent who coordinates the factors of production of the firm to achieve its objectives.

• Assumes risk: agent who assumes (takes responsibility for) the risk inherent in the economic activity carried out by the company.

• Owner-entrepreneur: agent who "acquires" productive factors in order to combine them to achieve a product to be sold at an uncertain price.

• Innovates: agent who detects market opportunities and guides the company to adapt and take advantage of them.

Who is the entrepreneur according to Knight...?

• Controls and organises: agent who coordinates the factors of production of the firm to achieve its objectives.

• Assumes risk: agent who assumes (takes responsibility for) the risk inherent in the economic activity carried out by the company.

• Owner-entrepreneur: agent who "acquires" productive factors in order to combine them to achieve a product to be sold at an uncertain price.

• Innovates: agent who detects market opportunities and guides the company to adapt and take advantage of them.

How can be classified the qualities of an entrepreneur? (more than one correct)

• CREATIVITY AND CONFIDENCE

• SOCIAL SKILLS

• OPTIMISM VS FRUSTRATION

• PERSONAL DEVELOPMENT