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chapter 1 (( Today, businesses are usually organized as one of three…
chapter 1
Today, businesses are usually organized as one of three specific types.
Service businesses – produce services, such as haircuts, legal advice, or tax preparation
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Today, experts often study economic problems from two different perspectives:
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Material resources – the raw materials used in manufacturing resources as well as buildings and machinery
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Financial resources – the money required to pay employees, purchase materials, and generally keep the business operating
Informational resources – information that tells the managers of the business how effectively the other three resources are being combined and used
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• A negative profit, which results when a firm’s expenses are greater than its sales revenue, is called a loss.
• Stakeholders – all the different people or groups of people who are affected by an organization’s policies, decisions, and activities
- 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
- Example: Our free enterprise system ensures that Amazon.com can sell everything from televisions, toys, and tools to computers, cameras, and clothing.
e-business – the organized effort of individuals to produce and sell for a profit, the goods and services that satisfy society’s needs through the facilities available on the Internet