Intro to Business 2
Terms
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- if increase taxes:
- less spending
- if decrease taxes:
- more spending
- interest:
- cost of money
- Capitalism: (Adam Smith)
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1. right to private ownership
2. entitled to all profits
3. freedom of choice
4. fair competition - Socialism:
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1. state owns basic non-profit businesses; some private industries exist
2. profits exist only in private sector
3. government can influence one's job choice - Communism:
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1. state owns all industries
2. profits are not officially recognized
3. state decides one's occupation.
put in what you can, you'll get out what you need - Profit Business
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main goal:
increase wealth of owner - Non-Profit Business
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Main goal:
provide good to society - Government Business
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Main Goal:
Security of Nation - Profit formula
- Revenue-expenses=profit
- Intristic Compensation
- doing something for less $
- Adam Smith's 4 rights in a free market
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1. own property/land
2. make a profit
3. to compete
4. own - fiscal policy
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use of government spending and taxes
to manipulate the economy - if government spending increases?
- =more jobs
- if government spending decreases:
- =less jobs
- ecology
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study of relationships between
living things
their environment
nutrients that support them - areas of corruption being addressed by international agreements
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bribes
air pollution
espionage--good corporate behavior - ethics
- rules/standards that governs a business
- ethical dilemma
- both sides of an issue that can be supported by valid arguments
- ethical lapse
- an individual makes a decision that is illegal, morally wrong or unethical
- stakeholders
- people to whom the busines has a responsiblity to: employees, customers, investors, etc.
- code of ethics
- written statement that a business is going to do business by
- 3 steps businesses take to encourage ethical behavior
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1. code of ethics
2. hire an ethics officer
3. ethics hot line - social responsibility
- a business has certain obligations to society other than the pursuit of profit
- social audit
- assessment of a company's performance in the area of social responsibility
- determining what is ethical
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1. religious teaching
2. is it legal
3. is it fair to all
4. does it make me feel good
5. will it actually work in the real world - 3 activities in which socially responsible business might engage
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1. social audit
2. cause-related marketing
3. philanthropic - cause-related marketing
- portion of sales helps worthy causes
- philanthropic
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giving of time, money, and goods to
charities
humanitarian institutions
environmental institutions - business responsibilities to society
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1. employees
2. customers
3. investors
4. society - pollution
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air, water, land
damage to/destruction of natural environment by harmful substances - industrial symbiosis
- some companies work together in a mutally advantageous relationship by one donating their waste product to one who uses it for fuel or raw materials
- activities to air pollution
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1. epa: environmental protection agency
2. some states pass own laws
3. recycling & safely disposing of hazardous materials - affirmative action
- activities undertaken to recruit women/minorities based on analysis of workforce and available labor pool
- 5 actions to take to address environmental problems
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1. measure environmental performance
2. research long-term cost before using materials
3.consider this part of daily business operation/operating decisions
4.conduct training/awareness programs
5.tie compensation to environmental performance - consumerism
- pressures business to consider consumer interests/needs
- diversity initiatives
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1. co. policy designed to enhance opportunities for minorities
2. promote understanding of diverse cultures, customs, talents - responsibility to investors
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1. accurately represent investment
2. accurately give what belongs to shareholders
3. keep quest for profits above board - insider trading
- attempt to benefit from stock market fluctuations by using unpublished info gained on the job
- discrimination
- denial of opportunities on the basis of some characteristic that has no bearing on their ability to perform a job.