Notesale: Turn your study into money

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BUGB 105 Final Study Guide
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Chapter Content
o Chapter 1:
 Free Enterprise: An economic system in which individuals own and operate the majority
of businesses that provide goods and services
 Pure capitalism or free-market system: happens when all economic decisions are
made without government intervention; also called laissez-faire capitalism
 Modified capitalism: differs from pure capitalism as the government intervenes
and regulates business to some extent
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o To earn a profit, you must: Act ethically, have management skills,
marketing expertise financial resources, have product and staff, abide
by the law, and adapting to change
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 Gross Domestic Product: The sum of all goods and services in a country during a given
year
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 Economic Expansion: When an economy is growing and people are spending more
money
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 Command Economy: an economy in which production, investment, prices, and incomes
are determined centrally by a government
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America uses a
communist and socialist system
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o Chapter 2
 Business Ethics: Principles and standards that determine acceptable conduct in a
business
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 Sarbanes-Oxley Act of 2002: Criminalized securities for fraud and stiffened penalties for
corporate fraud
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 Maintaining proper accounting procedures, providing investors with all relevant
information, and protecting owners’ rights and investments
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o Chapter 3:
 International Business: The buying, selling, and trading of goods across national
boundaries
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When a country
specializes in products that it can supply more efficiently or at a lower cost than it can
produce other items
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 Exports: The sales of goods and services to foreign markets
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 Balance of trade: The difference in value between what a nation exports and imports
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 Fixed Tariff: Specific amount of money levied on each unit of product brought
into a country
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 Exchange Controls: Regulation that restricts the amount of currency that can be
bought or sold
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 Embargo: A prohibition on for a particular product
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Chapter 4:
 Sole Proprietorship: Businesses owned and operated by one individual; the most common
form of business organization in the United States
 Advantages: Ease and cost of formation, Allow a high level of secrecy, Owner
keeps all profits, Flexibility and control of the business, Government regulation
is minimal, and Taxes paid only once
 Disadvantages: Unlimited liability, Scarce external funding, Owners need
diverse skills, Success is tied to the owner, Lack of qualified employees, and
Higher taxation
 Partnership: A form of business organization defined by the Uniform Partnership Act as
“an association of two or more persons who carry on as co-owners of a business for
profit”
 General Partnership: Involves a complete sharing in both the management and
the liability of the business
 Limited Partnership: Has at least one general partner, who assumes unlimited
liability, and at least one limited partner whose liability is limited to his or her
investment in the business
 Advantages: Easy to organize, Availability of capital & credit, Combined
knowledge and skills, Swift decision making, and Government regulations are
few
 Disadvantages: Unlimited liability, Responsible for each other’s’ decision, A
new agreement is needed if the partnership change, Difficult to sell a partnership
interest, Distribution of profits may be uneven, and Cannot find external funding
as easily as large corporations
 Corporations: A legal entity, created by the state, whose assets and liabilities are separate
from its owners
 Common Stock: Shares of the corporation that may be bought or sold
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 Advantages: Independence, costs, flexibility, Focus, and Reputation
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 Business Plans: A precise statement of the rationale for a business and a step-by-step
explanation of how it will achieve its goals
 Entrepreneurs: The process of creating and managing a business to achieve desired
objectives
 Franchising: A license to sell another’s products or to use another’s name in business, or
both
o Chapter 7:
 Organizational Culture: A firms shared values, beliefs, traditions, philosophies, roles, and
role models for behavior
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 Responsibility: Obligation that employees will get work done to be satisfactory and be
held accountable for proper execution of work
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 Communication in organizations:
 Formal Communications:
o Upward: Flows from low to high levels of an organization
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o Diagonal: When individuals from different units and organizational
levels communicate
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 Teams: A small group whose members have complementary skill, purpose, goals, and
approach; hold themselves accountable
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They share
common goals and identity
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Four functions of Management: Planning-setting objectives, Organizing-arranging tasks, Leadinginspire people, and Controlling
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o Middle Management: Responsible for the tactical plans implementing the general guidelines of
the corporation
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Conceptual Skills: The ability to think in abstract terms and to see how parts fit together to form the
whole
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Technical Expertise: The specialized knowledge and training needed to perform jobs that are related to
particular areas of management
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Transformation Process: InputsConversionoutputs Control StandardFeedback Control
Benefits of Standardization: The making of identical products makes the price to go lower for customers
to buy the product
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JIT Inventory: Using smaller quantities of materials of materials that arrive “just in time” for use in the
transformation process and therefore require less storage
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Total Quality Management: A philosophy whereby uniform commitment to quality in all areas of an
organization will promote a culture that meets customer’s perceptions of quality
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Motivation Process: NeedGoal-Directed Behavior Need Satisfaction
Hawthorne Studies: physical conditions in the workplace such as light and noise levels, would stimulate
employees to be most productive
Maslow’s Hierarchy of Needs: Made originally by Abraham Maslow, which includes levels, such as
Physiological, safety, belongingness and love, esteem needs, cognitive, aesthetic, need for selfactualization, and transcendence
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Theory Y: Humanistic view of management whereby it is assumed that workers like to work and that
under certain conditions they will seek out responsibility
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Expectancy Theory: The assumption motivation depends not only on how much a person wants
something but also on how likely they are to get it
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Job Enrichment: The incorporation of motivational factors, such as opportunity for achievement
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What Motivates employees? Hygiene and motivational factors, such as adequate wages and achievement
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Job Analysis: The determination, through observation and study, of pertinent information about a jobincluding tasks and necessary abilities, knowledge and skills
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Job Specification: The qualifications necessary for a specific job in terms of education, experience, and
personal and physical characteristics
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Wage: Financial rewards based on the number hours worked or level of output achieved
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Bonuses: Monetary rewards offered by companies for exceptional performance as incentives to increase
productivity further
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Benefits: Non-Financial forms of compensation provided to employees, such as pension plans, health
insurance, paid vacation and holidays
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6 Benefits of Workplace Diversity: More productive use of company resources, reduced conflict, more
productive working relationships, increased commitment, increased innovation, increased ability to serve
the needs of co-workers
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Chapter 11
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Marketing: A group of activities designed to expedite transactions by creating, distributing, pricing, and
promoting goods, services, and ideas
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Marketing Concept: The idea that an organization should try to satisfy customers’ needs through
coordinated activities that also allow it to achieve its own goals
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Marketing mix: Product, price, promotion, and distribution that firms can control to meet specific goals
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Marketing Segmentation: A strategy where a firm divides the total market into groups of people who
have relatively similar product needs
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Multi Segment Approach: Where the marketer aims its efforts at two or more segments, developing a
marketing strategy for each
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Primary Data: Marketing information that is observed, recorded, or collected directly from respondents
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Chapter 12
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Consumer Products: Products created for household or family use intended for daily living
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Product Life Cycle: IntroGrowthMaturityDecline
Price Skimming: Charging the highest possible price that buyers who want the product will pay
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Reference Pricing: Physiological pricing in which a lower priced item is compared to an expensive brand,
so consumer will compare the higher priced item to the low one
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Marketing Channel: Group of organizations that moves products from their producer to customers
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Two Products that are likely to be sold for personal selling: Cell phone as they enter the decline stage
and accessories at a store that are discounted
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Selective Distribution: Only a small number of outlets to expose products
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Chapter 13
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E-Business: Carrying out the goals of the business through utilization of the internet
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Country that uses most social media sites: Brazil and The United States
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Digital Media: Electronic media that function using digital codes via computers, cellular phones, smart
phones, and other digital devices that have been released in recent years
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Wikis: A website where users can add to or edit information of posted articles
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Applications and widgets: Applications on smartphones that allow one to access certain information or
even using them to get around using GPS
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Online Fraud: Any attempt to conduct fraudulent activities online
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Chapter 14
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Accounting: The recording, measurement, and interpretation of financial information
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Accounting Equation: Assets=Liabilities + Owner’s Equity
Asset: A firm’s economic resources, or items of value that it owns, such as cash
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Owners’ Equity: All the money contributed to the company that never has to be paid back
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Major Headings of an income statement: Source documents, transaction is recorded in a journal, then
posted in a ledger, and then financial statements are recorded for that period of time
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Money: Anything generally accepted in exchange for goods and services
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Objective of a bank: Accept money deposits from and make loans to individual consumers and
businesses
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For example, a business selling stocks, which starts the business,
but once they pay their investors back, they start making money
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An example would be a business being dishonest about their earnings to
avoid taxation
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Define Social Responsibility: When businesses meet legal, ethical, economic, and voluntary
responsibilities placed on by their stakeholders
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Define Two of the Ethics Principles: Integrity: acting honest in all situations, Accountability: taking
responsibility for all actions
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3 characteristics of Personal Presence: Positive attire, contributions, and body language and personal
tone
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Absolute and Comparative Advantage: Comparative Advantage: The basis of most international trade
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Absolute Advantage: A monopoly that exists when a country is the only source of an
item, the best producer of an item
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Why would a top manager would need more conceptual skills and less technical skills? The top
manager needs to know how to do most jobs that a company needs to do in order to stay in business
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Steps to the decision making process: Recognize the problem, develop options, analysis the options,
select the best option, and implement the decision
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Theory Y: Humanistic view of
management whereby it is assumed that workers like to work and that under certain conditions they will
seek out responsibility
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Difference between turnover, promotion, transfer, and separations as they are related to HR
management? Turn Over: When employees quit or are fired and must be replaced
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Transfer: A move to another job from another
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They are all related to HR, because HR are the
ones to make all these things final
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Export and Import: Export is when one sells goods to foreign markets, while importing is buying from
foreign markets to the U
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Purpose of Trade Agreements: The purpose of Trade agreements is to stimulate trade amongst other
countries by eliminating tariffs, quotas, or special fees
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Income Statement and Balance Sheet: An income statement is a financial report that shows an
organizations profitability over time, while a balance sheet is a snapshot of an organizations standings at
that moment in time
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