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GEB 2011 Introduction To Business

by: Paula Juliana

GEB 2011 Introduction To Business

Marketplace > Florida International University > Business > GEB 2011 Introduction To Business
Paula Juliana

Donald Roomes

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These are the notes for Chapter 1 and Chapter 2. We have a quiz due this Friday September 5 at 11:59pm, so feel free to use and read through my notes. They are very detailed, organized, and easy to...
Donald Roomes
Class Notes
GEB Intro. To Business
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This 48 page Class Notes was uploaded by Paula Juliana on Friday September 5, 2014. The Class Notes belongs to a course at Florida International University taught by a professor in Fall. Since its upload, it has received 124 views.


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Date Created: 09/05/14
CHAPTER 1 NOTES Monday August 25 2014 357 PM Economic Indicators Housing Stock Gas Prices Gas Prices Fluctuate Due To 1Supply 2Demand 3Gobal Trends 4Uncertainty 0 39 Organization that provides goods or services to ea 0 Difference between a business39s revenues and its e 0 Everything outside an organizatiol gt The environment in n Be close to customers establish strong relationships wsupp mm J nternational trade agreements international economic con All 1ho AI2IC hu whirh ram rn profits ltpenses n39s boundaries that might affect it hich a firm conducts its operations and derives its revenues Iiers and distinguish themselves from competition that affect a business ditions political unrest etc 1 rroafo ualno 39Fnr fhoir rnnc39I39i3939on39l39c quotquot39 quotquot39 quotquot 39Yquot Y quotquotquotquotquot39 quotquot39 Includes human knowledge work methods physical equipm systems used to perform business activities tracking sales amp gt The reetienshiIe between Gov39t regulation of business gt The customs mores vew organization functions Determines the goodsservices and standards of business co gt Relevant conditions that exist in If economy is doing well and most people have jobs a growil employees Business Cycle Economy has followed long periods of growth amp 0 A nation39s system for allocating its resou 0 Resources used in the production gt Physical amp mental capabilities of gt Funds needed to create amp operate a business ente gt Individual who accepts the risks and oppor IJ aIaCaILa VCJILJL IJI LIIII aLIIIJLILJIILJ ent electronics and telecommunications and various processing inventory levels business amp government es and demographic characteristics of the society in which an nduct that a society values and accepts n the economic system in which a company operates ng business may pay higher wages and give more benefits to attract prosperity wperiods of cutbacks and retreats Irces among its citizens both individuals and organizations of goods and services amp resources that an organization manages people as they contribute to economic production rprise tunities involved in creating and operating a new business venture gt Tangible items that organizations use gt Data amp other info used by busir Market forecasts specialized knowledge of people and ecor Types of Economic Systems Economy that relies on a centralized gc or most production and allocation decisions gt Political system in which the gov39t owns amp or gtSocialism A form of mixed market economy Economy in which individuals control prlt gt39 Mechanism for exchanges between buyers amp selle gtRelies on capitalism amp free enterprise gtUnderlying premise is to create shared value gtBuyers amp sellers enjoy freedom of choice gt System that sanctions the private ownership o offering profits as an incentive Economic system featuring cha gtn reality there are really no quotpurequot planned or market econlt gt Process of converting gov39t enterprises into gt Planned economic system in which the gov39t OV 2 in the conduct of their businesses IESSES lomic data gtvernment to control all or most factors of production and to make all Jerates all factors of production oduction and allocation decisions through supply amp demand rs of a particular goodservice fthe factors of production and encourages entrepreneurship by racteristics of both planned and market economies omies privately owned companies ns amp operates only selected major sources of production The Economics of Market Systems The willingness amp ability of producers to offer a gooc gt Producers will offer supply more ofa prol Direct relationship The willingness amp ability of buyers to purchase a gc gt Buyers will purchase demand more of a nverse relationship T Prommaximizing price Situation in which quantity supplied exceeds quant Situation in which quantity demanded exceeds q Economic system that allows individual 1Private property rights 2lFreedom of choice 1service for sale duct for sale as its price rises and less as its price drops odservice I product as its price drops and less as its price increases nship among different levels of supply amp demand at different price level will be supplied at different prices t will be demanded at different prices 2 at which the quantity of goods demanded amp supplied are equal ity demanded uantity supplied Is to pursue their own interests wo undue government restriction jjauj j 7 3Profits 4Com petition 0 Vying among businesses for the same resource gt Market or industry characterized b Must be LARGE NUMBER ofSMALL firms in the industry so I 1Products are similar to those of other firms 2Both buyers amp sellers know the prices that others are payin 3Bc firms are small it39s easy for them to enterleave the me 4Going prices are set exclusively by supply amp demand and ac gt Marketindustry characterize from those of competitors Brand names designstyling advertising Ex Coca Cola Lucky True Religion gt Marketindustry characterized bya handful Ofl products Actions of one firm affect sales of every other firm in the ind Ex Airlines gt There39s only one producer that can therefore s Industry in which one company can U o O OO39 ascustomers y numerous small firms producing an identical product 1o one is more powerful to influence price of product g amp receiving in the marketplace arket cepted by both buyers amp sellers ad by numerous buyers amp sellers trying to differentiate their products generally large sellers with the power to influence the prices of their ustry when one raises pricesgives discounts the others follow et the prices of its products I most efficiently supply all needed goodsservices iiumxboIolcomP0M0 5 Ease of entry mic g s 0 D 393 mdustry 0 goods or g Q G by foegtr39a 9 it 4 9 5 Lever 0 consrol over 0 by mdrvoduai rms c n o v v m L rvsv 395 a r 3 11 gt Economic Indicators z The total quantity of goods amp services gtThe primary measure of growth in the business cycle gtAn increase in aggregate outputeconomic growth gtWhen output grows more quickly than the population 10utput per capita the quantity of goods amp services per per 2The system provides more of the goods amp services that peo And people benefit from a higher standard of living 0 The total duantitv amp dualitv of goods 5 rmance of an economy amp contractions produced by an economic system during a given period son goes up ple want Ea services people can purchase wthe currencv used in their economic 39 39 39 39 V system mTota vaue ofangoodsa domestic factors of production GDP is a measure of aggregate output If GDP is going up aggregate output is going up and so there mTotava ueofa goodsamp regardless of where the factors of production are located Ex General Motors Auto Plan in Brazil profits are included in And wages paid to Brazilian workers are part of Brazil39s GNP e GDP amp GNP usually differ by less than 1 but economists arg performance Growth depends on output increasing at a faster rate than pc GDP per person GDP divided by total pop GDP adjusted to account for changes in currency gtPrice can go up but aggregate output can remain the same GDP measured in current dollars or with all 0 gtt39s not adjusted services produced win a given period by a national economy through s economic growth win the nation services produced by a national economy win a given period US GNP but not in GDP bc its output isn39t produced domestically even though profits aren39t ue GDP is a more accurate indicator of domestic economic p alues and price changes so the economy has not grown omponents valued at current prices 0 The principle that exchange ra1 are about the same gtGives a much better idea of what people can actually buy vv systems gtStandards of living across the globe A measure of economic growth that compare gtf more products are being produced wfewer factors of pro gtStandards of living improve only through increases in produo 0 Factors that can inhibit growth in an economic system The economic value of all the products t imports gtPositive balance of tradewhen country exportsgtit imports gtNegative balance of tradewhen country importsgtit exports AKA Trade Deficit Money spent on foreign products hasn39t of interest The money that flows out of the country to pay o or overseas US Debtor nation not Creditor nation 0 The amount of money the gov39t owes its cre 0 Conditions in which the amount of money availabl produced in it are growing at about the same rate gtA chief goal of an economic system tes are set so that the prices of similar products in different countries the nancial resources allocated to them by their respective economic as how much a system produces wthe resources needed to produce it duction the prices of the products will likely go down tivity hat a country exports minus the economic value of all the products it been paid in full so it39s borrowed money which costs more in the form ff the deficit can39t be used to invest in productive enterprises at home editors e in an economic system and the quantity of goods and services Occurs when widespread price increases occur tr gtCreates instability gtPeople have more money to spend but the same amount of many people declines gtDeflation widespread price cuts A measure of the prices of tyr gtExpressed as a of prices as compared to a base period The level ofjoblessness among people act gtIf wage rates get to high businesses will respond by hiring fa gtBusinesses could raise prices to counter increased labor cosquot reduced sales they will cut back on hiring and once again ur gtCyclical Unemployment During a downturn in the business 1 spending may drop so businesses may cut spending on facto A period during which aggregate output as meas gtWhen prices get too high consumer demand goes down gtWhen demand goes down producers cut back on hiring anc gtAggregate output decreases and we have a recession so un A prolonged and deep recession Policies used by a gov39t regarding how it coll gtTax rates nroughout an economic system products available to buy so prices go up and purchasing power for ical products purchased by consumers living in urban areas ively seeking work in an economic system ewer workers and unemployment will go up ts but they won39t be able to sell as much at higher prices Bc of 1empoyment will go up cycle people in different sectors may lose their jobs so income and rs of production like labor which causes unemployment to increase sured by GDP declines I produce less employment goes up lects and spends revenues 0 Policies used by a gov39t to control the s gtPrimarily through the Federal Reserve System Nation39s cen1 0 Gov39t economic policy intended to sn pnces gtMade up of both fiscal amp monetary policies ENACTUS CLUB Entrepreneurial activityin the community ize of its money supply tral bank gov39t can influence the willingness of banks to lend money 100th out fluctuations in output and unemployment and to stabilize CHAPTER 2 NOTES Wednesday September 3 2014 1027 AM Programs designed to ensure that export dependent far Beliefs about what39s right amp wronggood or bad in actions the 1 Behavior Toward Employees Hiringfiring wages working conditions privacy amp respect 2Behavior Toward The Organization Employee behavior toward employers such as conflict of interest wi confidentiality amp privacy 3Behavior Toward Other Economic Agents Relationship of a business amp its employees wprimary agents ofinter In dealing wsuch agents there39s room for ethical ambiguity in just al bargaining amp negotiating gt Steps for applying ethical iudgments to business situations mers in developing countries receive fair prices for their crops It affect others I norms concerning beneficial amp harmful actions accepted social norms concerning beneficial amp harmful actions Itext of their jobs nagers in their work wen an activity may benefit individual to the detriment of hisher employer est customers competitors stockholders suppliers dealers amp unions aout every activity advertising financial disclosure ordering amp purchasing 1Gather the relevant factual info Utiity Does a particular act optimize the benefits to those who are 2 Rights Does is respect the rights of all individuals involved Justice Is it consistent wwhat39s fair Caring Is it consistent wpeople39s responsibilities to each other 2Analyze the facts to determine the most appropriate moral values NO on all criteria NO on onetwo criteria gts there any reason for overriding onetwo of the ethical norms gts one ethical norm more important than the others gts there any reason why a person may have been forced into commit YES on all criteria 3Make an ethical judgment based on the rightness or wrongness of tl The single most effective step a company can take is to demonstratet Adopting Written Codes Athough strategies amp practices can change frequently and objectives remain steadfast instituting Ethics Programs Ex Managers must go through periodic ethics training amp ethical hotlil Ethics affect individual behavior Addresses the overallway in which a busine social environment e groups individuals and orga therefore have a stake in its performance Customers Employees Investors Suppliers and Local communities affected by it ting an actfollowing a policy he proposed activitypolicy op managementsupport can change occasionally an organization39s core principles amp values should nes where employees can call to report unethical behavior or discuss a problem ss attempts to balance its commitments to relevant groups amp individuals in its nizations that are directly affected by the practices of an organization and Social consciousness amp views toward social responsibility continue to 193039s people blamed the Great Depression for business greed and la protecting amp enhancing the general welfare of society gt concept of ac 194039s amp 5039s new laws contributed to a sense of aissez faire feelings 196039s amp 7039s business was again characterized as a negative social fc 198039 amp 9039s economic prosperity marked a return to the aissez faire Recent epidemic of corporate scandals threatens to revive the 3039s ca Areas of concern when addressing Social Responsibility 1Environment Issues involving climate change air water and land 2Customers Consumer rights unfair pricing ethics in advertising an Form of social activism dedicated to protecting the I Consumer Bill of Rights 1Consumers have a right to safe products 2Consumers have a right to be informed about all relevant aspects of 3Consumers have a right to be heard 4Consumers have a right to choose what they buy 5Consumers have a right to be educated about purchases 6Consumers have a right to courteous service Illegal agreement between two or more companies to clt nterfering wcompetition can take the form of illegal pricing practice evolve ack of restraint gt new laws emerged to dictate the role of businesses in countability was formalized 5 about business during economic prosperity rce and activism prompted increased gov39t regulation in many areas of business 2 philosophy II for more regulations and oversight oution Id green marketing rights of customers in their dealing wbusinesses a product mmit a wrongful act such as price fixing as Elements of Green Marketing gtProduction Processes Modified to limit consumption of valuable res gtProduct Modification The use of more enviro friendly materials gtCarbon Offsets Commitment to replenish repair or restore those p gtPackaging Reduction Reducing amp reusing materials gtSustainability Using renewable resources amp managing limited resoul 3Empoyees legal amp social commitments and the special case ofthe Provide opportunities to balance work amp life help employees mainta Employee who detects amp tries to put an end to a 4nvestors Improper financial management insider trading and mis llegal practice of using special knowledge about A business can take 1 of4 stances concerning its social obligations to 5 1 Doing as little as possible and may invol 2 Meeting only minimum legal requirements suc For small business ownersmanagers ethical issues are questions of it ources amp increase energy efficiency arts of enviro that are damaged by operations rces responsibly and efficiently whiste blower in job skills and when terminationslayoffs are necessary treat them wrespect company39s unethical illegal or socially responsible actions by publicizing them representation of finances 3 firm for profit or gain society ve attempts to denycover up violations h as admitting to mistakes amp taking corrective actions but nothing more ly asked to do so exceeds its legal amp ethical requirements Ite to the well being of groupsindividuals in its social enviro 1dividual ethics but they must ask themselves if they can afford a social agenda Relationship between business amp government Gov39t tries to shape social responsibility through directindirect chann Direct Method Establishment of lawsrules that dictate what organizal To implement regulations it creates special agencies to monitorcon Use of legislation to forbid bribery Indirect Method Tax codes that may encourage or discourage certain business decisiol 4 Main Methods Businesses Address Gov39t Pressures for Social Respor 1Personal Contacts 2 The use of personsgroups to formally represent an org 3 Special organizations crea legally make direct donations 4Favors Formal Organizational Dimensions That Can Help Manage Social Resp The extent to which the organization conforms The extent to which the members of the org The awarding of fundsgifts to charities or Informal Organizational Dimensions Organization39s thoughts on leadership amp culture gtEthical leadership often sets the tone for the entire organization How it responds to whiste blowers IEIS tions cancan39t do trol certain aspects of business activity ns 1sibility anization or group of organizations before political bodies ted to solicit S and then distribute it to political candidates since they can39t onsibility to local state federal and international laws anization follow basic ethical and legal standards of behavior other worthy causes 0 Systematic analysis of a firm39s success ir 1 using funds earmarked for meeting its social responsibility goals


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