key terms for chapters

key terms for chapters - Business Class Study Sheet Chapter...

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Business Class Study Sheet Chapter 1: 1) Free enterprise- the system of business in which individuals are free to decide what to produce, how to produce it, and at what price to sell it. 2) Cultural Diversity- the variety of human societies or cultures in a specific region, or in the world as a whole. 3) Business-a business is a legally-recognized organizational entity existing within an economically free country designed to sell goods and/or services to consumers, usually in an effort to generate profit. 4) Profit- what remains after all business expenses have been deducted from sales revenue. 5) Stakeholders- all the different people or groups of people who are affected by the policies and decisions made by an organization. 6) Economics- the study of how wealth is created and distributed. 7) Microeconomics- the study of the decisions made by individuals and businesses. 8) Macroeconomics- the study of the national economy and the global economy. 9) Economy- the way in which people deal with the creation and distribution of wealth. 10) Factors of Production- resources used to produce goods and services. 11) Entrepreneur- a person who risks time, effort, and money to start and operate a business. 12) Capitalism- an economic system in which individuals own and operate the majority of businesses that provide goods and services. 13) Invisible Hand- a term created by Adam Smith to describe how an individuals own personal gain benefits others and a nations economy. 14) Market Economy- an economic system in which businesses and individuals decide what to produce and by, and the market determines quantities sold and prices. 15) Mixed Economy- an economy that exhibits elements of both capitalism and socialism. 16) Consumer Products- goods and services purchased by individuals for personal consumption. 17) Command Economy- an economic system in which the government decides what goods and services will be produced, how they will be produced, for whom available goods and services will be produced, and who owns and controls the major factors of production. 18) Productivity- the average level of output per worker per hour. 19) Gross Domestic Product- the total dollar value of all goods and services produced by all people within the boundaries of a country during a one-year period. 20) Inflation- a general rise in the level of prices. 21) Deflation- a general decrease in the level of prices. 22) Consumer Price index- a monthly index that measures the changes in prices of a fixed basket of goods purchased by a typical consumer in an urban area. 23) Producer price index- an index that measures prices at the wholesale level.
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24) Business cycle-the recurrence of periods of growth and recession in a nations economic activity. 25) Recession-a decline in any country's Gross Domestic Product (GDP), or negative
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key terms for chapters - Business Class Study Sheet Chapter...

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