Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
LEARNING OBJECTIVES
2. Describe the external environments of business and discuss how these environments affect the success or failure of any organization.
3. Describe the different types of global economic systems according to the means by which they control the factors of production.
Copyright 2011 Pearson Education, Inc. publishing as Prentice Hall 1-2
L E A R N I N G O B J E C T I V E S (cont.)
After reading this chapter, you should be able to:
4. Show how markets, demand, and supply affect resource distribution in the United States.
5. Identify the elements of private enterprise and explain the various degrees of competition in the U.S. economic system.
6. Explain the importance of the economic environment to business and identify the factors used to evaluate the performance of an economic system.
1-3
1-4
1-5
1-6
1-7
Competitors
Currency values
1-8
1-10
1-11
Economic Systems
Economic System
A nations system for allocating its resources among its citizens, both individuals and organizations
Factors of Production
Labor Capital Entrepreneurs Physical resources Information resources
1-13
Market Economy
Individual producers and consumers control production and allocation by creating combinations of supply and demand.
1-14
1-15
Market
A mechanism of exchange between buyers and sellers of a good or service.
1-16
Supply
The willingness and ability of producers to offer a good or service for sale.
1-18
1-19
1-20
1-21
Shortage
A situation in which the quantity demanded will be greater than the quantity supplied
1-22
Degrees of Competition
Perfect Competition
No single firm is powerful enough to influence the price of its product.
All firms in an industry are small. The number of firms in the industry is large.
Four Principles:
Buyers view all products as identical. Buyers and sellers know the prices that others are paying and receiving in the marketplace. Firms easily enter or leave the market. Prices are set exclusively by supply and demand.
Copyright 2011 Pearson Education, Inc. publishing as Prentice Hall 1-24
1-25
The actions of one firm can significantly affect the sales of every other firm in the industry.
The prices of comparable products are usually similar. As the trend toward globalization continues, most experts believe that oligopolies will become increasingly prevalent.
1-26
1-27
Economic Indicators
Economic Indicators
Statistics that show whether an economic system is strengthening, weakening, or remaining stable GDP GNP Balance of trade Trade deficit National Debt Inflation CPI Unemployment
1-29
1-30
1-31
Inflation
Inflation occurs when the amount of money injected into an economy exceeds the increase in actual output, resulting in price increases exceeding purchasing power increases.
1-32
1-33
Cyclical Unemployment
Businesses continuing to eliminate jobs during a business cycle downturn cause more reduced revenues and further job losses.
1-34
Depression
A prolonged and deep recession
1-35
Monetary Policy
The manner in which a government controls its money supply.
Stabilization Policy
Coordinating fiscal and monetary policies to smooth fluctuations in output and unemployment and to stabilize prices.
1-36
Key Terms
aggregate output balance of trade business business cycle capital capitalism communism competition consumer price index demand demand and supply schedule demand curve depression domestic business environment economic environment economic indicators economic system entrepreneur external environment factors of production fiscal policies
1-37
1-38
1-39
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.
1-40 40