Chapter One Notes
What Makes a Firm Successful?
7 % of firms in the US are new and 1% go out of business each year.
25% of todays major corporations will exist in 25 years.
Is it Just Luck that some succeed?
-Luck has some role in firms performance but no
Market Failures Inside the Firm
Based on money
-For most firms, it is difficult to measure individual contributions to the value of the firm.
-No one owns the reputation, no one takes care of it.
- Public goods can be dealt with by
Chapter 2 notes:
Private property rights: that please can own things and they can pretty much do what
they want with what they own.
Enforced in richest nations.
When property rights are not universal among citizens, or when enforcement is not
What are Administrative Agencies?
Administrative agency: best defined by what it is not: it is not a legislative or
A statutory creation within the executive branch with the power to make,
interpret, and enforce laws.
-Production Possibility Curve ( PPC) or frontier: The choices among two resource allocations are
illusted using the trade off curve. This curve shows those combinations of outputs that can be
produced/created when existing resources and technolo
Chapter 8 Notes:
-Managers must make decisions in the context of existing rivals and take into
account the possible actions of potential rivals. Market structure that focuses on this
interdependence is called oligopoly.
-Game Theory: All managers are abso
The prime directive might be to look at the market first.
Price system is not the most relied on because some people do not like the outcome.
They do not like the creative destruction.
Rent seeking: They lobby the government or attempt to con
-Most exchanges are not carried out in open, free, unfettered markets. They are carried
through institutions such as firms.
The existence of firms
Residual income: the risk is shifted to the owners who are compensated. The income left after
UNIVERSITY OF THE CUMBERLANDS
Hutton School of Business
BUOL 533, Marketing Management
Summer II G 2016
Executive Program Format
Dr. Vonda K. Moore
Hutton School of Business, Office 105