sg01 - CHAPTER 1 BUSINESS: 2005 AND BEYOND Chapter Summary:...

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CHAPTER 1 BUSINESS: 2005 AND BEYOND Chapter Summary: Key Concepts What Is Business?: Business All profit seeking activities and enterprises that provide products and services needed or desired in an economic system. Not--for-profit Establishments that have primary objectives other than organizations returning profits to their owners. Included are all government agencies as well as private-sector non-profits like trade organizations, charitable and religious organizations, and private educational institutions. Factors of production The inputs to operational effectiveness include a combination of natural resources, human resources, capital and entrepreneurship. Private enterprise system Capitalism Capitalism is another name for the Private Enterprise System. Capitalism minimizes government interference in economic activity and rewards businesses for their ability to perceive and serve the needs of customers. Basic rights in the There are four basic rights. The first and most fundamental private enterprise system is the right to private property: the right to own, use, buy, sell, and bequeath most forms of tangible and intangible property. The second is the business owners’ right to after tax profit. The third is the freedom of choice in employment, purchases, and investment. The fourth basic right is the right to fair competition: allowing the public to set rules for competitive activity.
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1-2 Part I: Business in a Global Environment The entrepreneurship Entrepreneurs are risk takers who recognize marketplace alternative opportunities and use their skill and capital to seize and profit from those opportunities. The spirit of entrepreneurship drives the fast pace of new business creation in America. It also contributes to innovative behavior in large organizations. Six Eras in the History of Business The colonial period Prior to 1776, our economy was rural and agricultural, and relied on England for manufactured items and for the financing needed to develop. Industrial revolution Between 1760 and 1850, the industrial revolution saw mass production by semiskilled workers, aided by machines. The age of the industrial The 1880s was an era of industrial entrepreneurship. entrepreneur Advances in technology and increased demand for manufactured goods led to enormous entrepreneurial opportunities. The production era Between 1900 and the 1920s the focus was on producing more goods faster. Every effort was made to meet growing demand leading to production innovations like the assembly line. The marketing era During the 1950s marketing grew to mean much more then selling. Since ability to produce was not enough, businesses began to focus on producing just what customers wanted. That is, customer orientation became the center of business thinking. The relationship era
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sg01 - CHAPTER 1 BUSINESS: 2005 AND BEYOND Chapter Summary:...

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