ba 101 introduction to business 1. fundamentals of business and economics
TRANSCRIPT
BA 101 Introduction to Business
1. Fundamentals of Business and Economics
What is a Business?
Knowledge
Entrepreneurs
For-ProfitFor-ProfitFor-ProfitFor-Profit
• GoodsGoods
• ServicesServices
• Job creationJob creation
• Tax-baseTax-base
• InvestmentsInvestments
• GoodsGoods
• ServicesServices
• Job creationJob creation
• Tax-baseTax-base
• InvestmentsInvestments
Non-ProfitNon-ProfitNon-ProfitNon-Profit
• EducationEducation
• LibrariesLibraries
• MuseumsMuseums
• Social servicesSocial services
• CharitiesCharities
• EducationEducation
• LibrariesLibraries
• MuseumsMuseums
• Social servicesSocial services
• CharitiesCharities
Re
sou
rces C
ap
ital
Categories of Business
Providing ServicesProviding ServicesProducing GoodsProducing Goods
Capital Intensive Labor Intensive
Service Sector Growth
More disposable incomeMore disposable income
Lifestyle and demographic changesLifestyle and demographic changes
Complex goods and technologiesComplex goods and technologies
Need for professional adviceNeed for professional advice
Low barriers to entryLow barriers to entry
What is Economics?
Microeconomics Microeconomics
MacroeconomicsMacroeconomics
Economic SystemEconomic System
Factors of Production
Resources
Capital
Entrepreneurs
Knowledge
Economic Systems
CapitalismMixed
CapitalismSocialism Communism
Privatization
Free-MarketSystem
PlannedSystem
MicroeconomicsMicroeconomics
The Forces of Supply and Demand
Supply and Demand
Supply: Specific quantity of a product that the seller is able and willing to provide
Demand: Buyers’ willingness and ability to purchase products
Advertising andAdvertising andPromotion SpendingPromotion Spending
Advertising andAdvertising andPromotion SpendingPromotion Spending
Consumer IncomeConsumer IncomeConsumer IncomeConsumer Income Consumer PreferencesConsumer PreferencesConsumer PreferencesConsumer Preferences
Price ofPrice ofSubstitute ProductsSubstitute Products
Price ofPrice ofSubstitute ProductsSubstitute Products
Price of Price of Complementary GoodsComplementary Goods
Price of Price of Complementary GoodsComplementary Goods
Expectations AboutExpectations AboutFuture PricesFuture Prices
Expectations AboutExpectations AboutFuture PricesFuture Prices
Price
High
erLo
wer
Demand
LowerHigher
Understanding Demand
Understanding Supply
Goods andServices
Supply
Price
Variables Variables
Higher
MoreLess
Lower
The Relationship between Supply and Demand Variables that affect supply and
demand change simultaneously and continually, thus creating changes in the equilibrium price.
Both production levels and prices reflect the interaction of supply and demand.
MacroeconomicsMacroeconomics
Issues for the Entire Economy
PurePureCompetitionCompetition
MonopolisticMonopolisticCompetitionCompetitionOligopolyOligopoly
MonopolyMonopoly
Free-Market Competition
Price
Speed
Quality
Service
Innovation
Competitive AdvantageCompetitive Advantage
The Role of Government
Fostering competitionFostering competition
Regulating industriesRegulating industries
Deregulating industriesDeregulating industries
Protecting stakeholders’ rightsProtecting stakeholders’ rights
Contributing to economic stabilityContributing to economic stability
Fostering Competition
AntitrustLegislation
Mergers andAcquisitions
Regulating and Deregulating Industries
GovernmentGovernmentRegulationRegulation
FreeFreeCompetitionCompetition
Fair CompetitionFair CompetitionFair CompetitionFair Competition
Business EthicsBusiness EthicsBusiness EthicsBusiness Ethics
Working ConditionsWorking ConditionsWorking ConditionsWorking Conditions
Public SafetyPublic SafetyPublic SafetyPublic Safety
Contributing to Economic Stability
EconomicEconomicExpansionExpansion
EconomicEconomicContractionContraction
RecoveryRecovery
RecessionRecession
BusinessBusinessCycleCycle
BusinessBusinessCycleCycle
MonetaryMonetaryPolicyPolicy
FiscalFiscalPolicyPolicy
InterestInterestRatesRates
Revenue andRevenue andSpendingSpending
Major Economic Indicators
Housing StartsHousing Starts
Durable-GoodsDurable-GoodsOrdersOrders
Interest RatesInterest Rates
UnemploymentUnemploymentStatisticsStatistics
Measuring Price Changes
InflationInflation DeflationDeflation
Consumer Price Index (CPI)
Purchasing PowerPurchasing Power
Measuring National Output
Gross NationalProduct (GNP)
Gross DomesticProduct (GDP)Dollar ValueDollar Value
YesYesYesYesFinal Goods Final Goods and Servicesand Services
YesYesYesYesDomestic BusinessesDomestic Businesses
NoNoYesYesForeign-Owned Foreign-Owned BusinessesBusinesses
YesYesNoNoOverseas OperationsOverseas Operations
Ten Economic Performance Indicators
Prime Interest RatePrime Interest Rate
Housing StartsHousing Starts
Labor Productivity RateLabor Productivity Rate
Rate of InflationRate of Inflation
Consumer Price IndexConsumer Price Index
Unemployment RateUnemployment Rate
Durable-Goods OrdersDurable-Goods Orders
Balance of TradeBalance of Trade
Producer Price IndexProducer Price Index
Gross Domestic ProductGross Domestic Product
What does the future hold?
The aspect of terrorism China in the global economy Work mobility Deficits in budget and balance of trade E-business
Challenges of Globalization
Quality products and servicesQuality products and services
Changing needs of customersChanging needs of customers
Managing a small businessManaging a small business
Globalization and workforce diversityGlobalization and workforce diversity
Ethics and social responsibilityEthics and social responsibility
Technology and electronic commerceTechnology and electronic commerce