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Chapter 1 Lecture Notes

The document outlines the fundamentals of business and wealth building, emphasizing the importance of entrepreneurship, revenue, and profit. It discusses the five elements of the business environment, including economic, technological, competitive, social, and global factors, as well as various economic systems like capitalism and socialism. Additionally, it highlights key economic indicators and trends affecting the U.S. economy, such as shifts from agriculture to manufacturing and the rise of the service industry.

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5 views3 pages

Chapter 1 Lecture Notes

The document outlines the fundamentals of business and wealth building, emphasizing the importance of entrepreneurship, revenue, and profit. It discusses the five elements of the business environment, including economic, technological, competitive, social, and global factors, as well as various economic systems like capitalism and socialism. Additionally, it highlights key economic indicators and trends affecting the U.S. economy, such as shifts from agriculture to manufacturing and the rise of the service industry.

Uploaded by

bsanto19
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Business and Wealth Building-

●​ Definition: Business involves providing goods/services for profit. Successful


businesses identify consumer needs and use platforms like tv, social media, and
online advertising to reach audiences.
●​ Revenue and profit: Revenue is the income from sales, profit is revenue minus
expenses. Businesses must avoid losses to stay operational and prevent
unemployment.
●​ Entrepreneurship: Entrepreneurs create wealth by taking risk, employing
others, paying taxes, and contributing to their communities,
●​ Case study: Aaron Krause’s Scrub Daddy represents risk-taking and innovation,
eventually leading to a massive success.
●​ Nonprofits: Nonprofit organizations aim to meet societal goals rather than
generating personal profit. Nonprofits' strong management focuses on purpose,
employee investment, and wellness programs.

The Five Elements of the Business Environment:


1.​ Economic and legal environment:
●​ Private ownership of businesses encourages change.
●​ Strong legal systems reduce risk for entrepreneurs.

2.​ Technological environment:


●​ Benefits efficiency and productivity (amount of output generation vs amount of
input).
●​ Including phones, computers, mobile devices, medical machines, robots, social
media, the internet, software programs and apps.

3.​ Competitive environment:


●​ Requires quality, customer focus, and strong relationships with suppliers.
●​ Must be unique and distinct.

4.​ Social environment:


●​ Population demographic impacts buying behavior.
●​ Includes age, density, size, race, and come, and gender.
●​ Diversity and inclusion laws help shape workplace dynamics.

5.​ Global environment:


●​ Trade agreements, climate change, war and terrorism, international markets,
and Global crisis (ex: pandemics) impact businesses.

Understanding economics:
●​ Macroeconomics: Examines national/global trends like gross domestic
product(GDP), unemployment, and inflation.
●​ Microeconomics: Focuses on individual/organizational decision-making.
●​ Resource development: Innovations like fish farming demonstrate creating
resources to boost growth by creating jobs and food.
Types of economic systems:
●​ Capitalism: driven by profit, with decisions made in free markets. includes rights
to property, competition, and choice.
●​ Socialism: prioritizes equality with benefits like free healthcare but may reduce
innovation/inventions.
●​ Communism: government controlled, often lacking incentives for productivity.
●​ Mixed Economies: combines capitalism and socialism to address economic
equalities and protect the environment.

U.S. economic system:


●​ Supply and demand: prices and product depend on market negotiations.
Key indicators:
●​ GDP: Measures economic output.
●​ unemployment: Indicates labor market health .
●​ Inflation: Monitored via consumer and producer price indexes .
●​ Business Cycles: Fluctuations include booms, recessions, depressions, and
recoveries.
Policies:
●​ Fiscal policy: Government taxation and spending to influence the economy.
●​ Monetary policy: Managed by the federal reserve, adjusting interest rates and
money supply.

Historical and Future Trends:


●​ Agriculture to Manufacturing: technological advances reduce agricultural jobs,
shifting the workforce to factories.
●​ Service Industry: now the largest sector, offering high paying roles in law,
health, and technology.
●​ Globalization and Technology: Emerging innovations will shape future business
landscapes and opportunities for graduates.

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