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Questions and Answers
What is the primary purpose of a firm?
What is the primary purpose of a firm?
- To maintain a stable organizational structure.
- To maximize profit by transforming inputs into outputs. (correct)
- To create a social entity focused on teamwork.
- To achieve individual goals unrelated to customers.
Which of the following best describes the neo-classical theory perspective of a firm?
Which of the following best describes the neo-classical theory perspective of a firm?
- The firm focuses on reducing transaction costs in all operations.
- The firm relies on government intervention for market stability.
- The firm is a 'black box' that simply maximizes profit. (correct)
- The firm prioritizes stakeholder interests over profit.
What effect does a disproportionate level of income inequality generally have on society?
What effect does a disproportionate level of income inequality generally have on society?
- It enhances social cohesion and economic growth.
- It reduces social cohesion and increases social conflict. (correct)
- It leads to a more stable economic environment.
- It creates more job opportunities for everyone.
According to transaction cost theory, what is a key determinant in whether to make or buy a product?
According to transaction cost theory, what is a key determinant in whether to make or buy a product?
What does bounded rationality refer to in transaction cost theory?
What does bounded rationality refer to in transaction cost theory?
How is the firm characterized in agency theory?
How is the firm characterized in agency theory?
Which statement best reflects the relationship between firms and organizations?
Which statement best reflects the relationship between firms and organizations?
What is the expected behavior of markets according to the neo-classical theory?
What is the expected behavior of markets according to the neo-classical theory?
What is a principal-agent relationship characterized by?
What is a principal-agent relationship characterized by?
Which of the following costs are considered agency costs?
Which of the following costs are considered agency costs?
Which of the following is NOT a characteristic of resources that lead to sustained competitive advantage?
Which of the following is NOT a characteristic of resources that lead to sustained competitive advantage?
What is a primary reason for implementing an incentive mechanism in a firm?
What is a primary reason for implementing an incentive mechanism in a firm?
Which type of firm is an example of a state-owned firm?
Which type of firm is an example of a state-owned firm?
In terms of legal forms, which of these describes a corporation?
In terms of legal forms, which of these describes a corporation?
What classification of firms involves activities conducted in more than one country?
What classification of firms involves activities conducted in more than one country?
Which type of productive activity does REPSOL belong to?
Which type of productive activity does REPSOL belong to?
What is the main objective of implementing an incentive mechanism in a firm?
What is the main objective of implementing an incentive mechanism in a firm?
Under what circumstances can firm resources lead to sustained competitive advantage?
Under what circumstances can firm resources lead to sustained competitive advantage?
What type of firm is characterized by joint ownership and shared profits among two or more people?
What type of firm is characterized by joint ownership and shared profits among two or more people?
What category does a wholesale company, such as Makro, fall under?
What category does a wholesale company, such as Makro, fall under?
Which of the following is NOT considered an agency cost?
Which of the following is NOT considered an agency cost?
In which legal form does the business stand separately from its owners?
In which legal form does the business stand separately from its owners?
What characteristic differentiates micro firms from larger firms?
What characteristic differentiates micro firms from larger firms?
What is the primary concern resulting from information asymmetry in principal-agent relationships?
What is the primary concern resulting from information asymmetry in principal-agent relationships?
What is a key distinction between firms and other organizations?
What is a key distinction between firms and other organizations?
What impact does income inequality have on economic growth?
What impact does income inequality have on economic growth?
According to transaction cost theory, which costs are significant in market transactions?
According to transaction cost theory, which costs are significant in market transactions?
In the context of agency theory, how is the firm primarily viewed?
In the context of agency theory, how is the firm primarily viewed?
Which factor is considered when using the make-or-buy decision in transaction cost theory?
Which factor is considered when using the make-or-buy decision in transaction cost theory?
What defines a firm's economic functions?
What defines a firm's economic functions?
What is the main belief of neoclassical theory regarding market functions?
What is the main belief of neoclassical theory regarding market functions?
What role do stakeholders play in the context of a firm as a social reality?
What role do stakeholders play in the context of a firm as a social reality?
Flashcards
What is an organization?
What is an organization?
An organization with a clear goal, formed by people, and structured with defined tasks and responsibilities.
What is a firm?
What is a firm?
A profit-seeking organization that transforms inputs into outputs to satisfy customer needs.
What is the economic reality of a firm?
What is the economic reality of a firm?
The idea that firms act as intermediaries, transforming lower-value inputs into higher-value outputs.
What is the social reality of a firm?
What is the social reality of a firm?
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What are transaction costs?
What are transaction costs?
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What is the neoclassical theory of the firm?
What is the neoclassical theory of the firm?
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What is the transaction cost theory?
What is the transaction cost theory?
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What is the agency theory?
What is the agency theory?
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Principal-Agent Problem
Principal-Agent Problem
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Agency Costs
Agency Costs
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Agency Theory
Agency Theory
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Resource-Based View (RBV) of the Firm
Resource-Based View (RBV) of the Firm
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VRIO Framework
VRIO Framework
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Private-Owned Firm
Private-Owned Firm
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State-Owned Firm
State-Owned Firm
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Mixed Equity Firm
Mixed Equity Firm
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What are agency costs?
What are agency costs?
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What is Transaction Cost Theory?
What is Transaction Cost Theory?
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What is Agency Theory?
What is Agency Theory?
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What is the Resource-Based View (RBV) of the firm?
What is the Resource-Based View (RBV) of the firm?
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How are a firm's activities assessed?
How are a firm's activities assessed?
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Resource-Based View of the Firm (RBV)
Resource-Based View of the Firm (RBV)
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Study Notes
Course Information
- Course title: Business Economics
- Instructor: MarÃa Espadas Puyet
- Institution: CUNEF Universidad
- Course Code: DADE-C
Table of Contents
- Unit 1 - The Firm: The nature of the firm, types of firms, ownership and management, entrepreneurship (pages 3, 5).
- Unit 2 - Theoretical Approaches to Management: Classical approach (Scientific Management, General Administrative Theory); Behavioral approach (Hugo Münsterberg, Mary Parker Follett, Chester Barnard, Hawthorne Studies, Douglas McGregor); Quantitative approach (page 9).
- Unit 3 - Business Environment: General environment (PESTEL analysis, international factors); Competitive environment (suppliers, distributors, customers, competitors) (pages 11,12).
- Unit 4 - Information and Decision Making: Information and data; Attributes of useful information; Decision-making (rational, bounded rationality, intuitive); Programmed and non-programmed decisions; Decision-making conditions (certainty, risk, uncertainty, ambiguity) (page 14).
- Unit 5 - Business Management: Business administrators, nature of a manager's job (management types functional and general managers, management skills technical, interpersonal, conceptual), management functions (planning, organizing, leading, controlling), leadership styles (autocratic, democratic, laissez-faire) (pages 18, 19,20,26).
- Unit 6 - Objectives and Growth of the Firm: Economic goal and value creation (accounting profit, economic profit, shareholder profitability/return); Social responsibility, sustainability and ethics (6.2) (pages 28-29).
- Organizational Growth: Strategic management (SWOT analysis, corporate & competitive strategies), scope of the firm (vertical, horizontal, geographical), forms of growth ; Innovation types and innovation strategies (6.4) (pages 30, 32).
Additional Concepts
- Agency Theory: the firm as a nexus of contracts, principal-agent relationships, agency costs.
- Resource-Based View (RBV): firm resources and capabilities, competitive advantage.
- Transaction Cost Theory: costs involved in carrying out transactions, bounded rationality, opportunism.
- Porter's Five Forces: a technique for analyzing a business industry, analyzes threats and competition (page 12).
- Organizational Culture: shared values, principles, traditions, and ways of doing things (page 13).
- Information Technology (IT): the set of methods for acquiring, organizing, storing, manipulating, and transmitting information. (page 17).
- Management Skills: technical, interpersonal, and conceptual skills. (Page 19).
- Organizational Structures: Mechanistic and Organic types, different types of specialization, formalization, and centralization/decentralization (page 22).
- Different leadership styles: Autocratic, Democratic, and Laissez-faire(page 26).
- Motivation Theories: Maslow's hierarchy of needs, Herzberg's two-factor theory, Goal-setting theory, equity theory, expectancy theory (Page 24).
- Forms of growth (internal, mergers/acquisitions, mergers by absorption, pure mergers, strategic alliances) (page 32).
- Innovation: Process and product innovation (page 32).
- Information systems: customer relationship management (CRM) systems, enterprise resource planning (ERP) systems (page 17).
- Controlling: a three-step process involving measuring performance, comparing against standards, and implementing corrective actions. (page 26).
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Description
Test your knowledge on key concepts from the Business Economics course including the nature of firms, management theories, and the business environment. This quiz covers various units, focusing on decision-making and information management. Challenge yourself and reinforce your understanding of business economics!
