Introductory Concepts in Business - Business Question/Answer (100 Level Course)

Introductory Concepts in Business - Business Question/Answer(100 Level Course)

1. What is the difference between revenue and profit?
- Revenue is the total amount of money a business takes in during a given period by selling goods and services while Profit is the amount of money a business earns above and beyond what it spends for salaries and other expenses.

2. What is the difference between standard of living and quality of life?
- Standard of living is the amount of goods and services people can buy with the money they have while Quality of life is the general well being of a society in terms of political freedom, a clean natural environment, education, health care, safety, free time, and everything else that leads to satisfaction and joy.

3. What is the risk, and how is it related to profit?
- Risk is the chance an entrepreneur takes of losing time and money on a business that may not provide profitable. Starting a business involves risk. Risk taking is the critical element for improving our standard of living. Risk is the chance an entrepreneur takes on losing time and money on a business that may not prove profitable. Those companies that take the most risk may make the most profit. The more risks you take, the higher the rewards may be. This is how risk is related to profit..

4. What does the term stakeholders mean?
- Stakeholders are all the people who stand to gain or lose by the policies and activities of a business. Stakeholders include customers, employees, stock holders, suppliers, dealers, bankers, people in the surrounding community, environmentalists, and elected government leaders.

5. What are some of the advantages of working for others?
- The advantages of working for others is that somebody else assumes the entrepreneurial risk and provides you with benefits such as paid vacation time and health insurance.

6. Why is the United States called the land of opportunity?
- The United States provides opportunity for all. One of the strengths of the United States is its ability to welcome people from all over the world and help them prosper. Often the most attractive opportunity for many people is that of owning and managing their own businesses and the United States provides this opportunity. Tremendous opportunities exist for all men and women willing to take the risk of starting a business. Thus it is called the land of opportunity.

7. What are the five factors of production? Which factors are the key of wealth?
- The five factors of production are
1. Land
2. Labor
3. Capital
4. Entrepreneurship
5. Knowledge
Entrepreneurship and knowledge are the factors which are the key to wealth.

8. What are four ways the government can foster entrepreneurship?
- The ways in which the government can foster entrepreneurship is they can keep taxes and regulations to a minimum, they can actively promote entrepreneurship is to allow private ownership businesses, the governments of developing countries can do is to minimize the interference with the free exchange of goods and services, the government can lessen the risks of entrepreneurship by passing laws that enable businesspeople to write contracts that are enforceable in court, the government can also establish a currency that’s tradable in world markets, they can help minimize corruptions in business and in its own ranks. Thus the government can foster entrepreneurship.

9. What is productivity and how does technology enhance it?
- Productivity is the amount of output you generate given the amount of input (e.g. hours worked). Technology means everything from phones and copiers to computers, medical imaging devices, personal digital assistants, and the various software programs that make business processes more efficient and productive. Tools and technology greatly improve productivity. The workers in United States make more money than in most other country is that they have access to the technologies that make them more productive. Thus technology enhances productivity.

10. How can companies compete with speed?
- Usually the companies that provide speedy service are those that are winning. Speeding isn’t everything. It has to be accompanied by good quality and reasonable prices. To keep up in such a dynamic business environment, people have to return to school periodically over their lifetime to learn the latest concepts, strategies, and tools.

11. What are some of the diverse groups of people that managers must manage?
- Some of the diverse groups of people that managers must manage are whether they are different because of race, sex, age, sexual orientation, country of origin, religion, etc.

12. What are the factors that have led to two-income families?
- The factors that have led to two-income families are the high costs of housing and of maintaining a comfortable lifestyle, the high level of taxes, and the cultural emphasis on “having it all”.

13. What is the major factor that caused people to move from farming to industry and from industry to the service sector?
- The use of technology such as invention of harvester, cotton gin, and modern improvements on such equipments is the major factor that caused people to move from farming to industry. Increased productivity and efficiency made many people move from industry to the service sector.

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