Business Fundamentals Unit 1 Quiz

Unit 1: Business Fundamentals

• Needs vs. Wants: Needs are essential for survival (water, shelter, food), while wants are desires that can be deferred.

• Profit Equation: Profit = Revenue - Expenses. For kilt pins, profit is $1.06 ($3 - $1.94).

• Business Existence: Businesses exist to provide goods/services and generate profit. Some businesses are not-for-profit.

Unit 1, Lesson 1.2: Demand

• Disposable Income: Income remaining after taxes and mandatory deductions.

• Discretionary Buying Power: The amount of disposable income left for non-essential items.

• Demand: Consumer willingness to spend money on products/services at a given price.

• Law of Demand : Price drops = demand rises—and vice versa.

• Pricing Factors Affecting Demand: Price positioning (luxury vs. discount), price sensitivity (how demand reacts to price), and substitutes (alternative products).

• Non-Pricing Factors Affecting Demand: Personal/household income, new technology, advertising/promotion, and trends/fads impact demand for products.

Unit 1, Lesson 1.3: Supply

• Supply: The quantity a business is willing/able to provide at various prices.

• Law of Supply: Price increases = supply increases; price decreases = supply decreases.

• Pricing Factors Affecting Supply: Improved procedures, loss leader pricing, bundled pricing to improve overall sales.

• Non-Pricing Factors Affecting Supply: Capacity (limit on production), material shortages.

• Equilibrium Point: Supply and demand meet; prices are stable.

• Break-Even Point: Total costs = total revenue.

Unit 1, Lesson 1.4: Types of Businesses

• Profit vs. Not-for-Profit: Profit businesses aim for profit, while not-for-profit organizations use income for their stated purposes.

• Not-for-profit Funding: Donations and potentially government funding.

• Profit Purpose: All businesses do not necessarily aim for profit.

Unit 1, Lesson 1.5: Market Forces

• Market Forces: Factors influencing prices and quantities, including competition, consumer preferences, technology, economic factors, and government regulations.

Unit 1, Lesson 1.6: Types of Business Ownership

• Corporation: Separate legal entity, limited liability for owners.

• Sole Proprietorship: Business owned by one person; full control, simple to operate.

• Partnership: Business owned by two or more people; shared responsibility & resources.

• Franchise: Business model where a franchisee buys the rights to sell an established brand.

• Co-operative: Business owned and controlled by its members; each member has one vote.

• Subcategories of Business Ownership: Crown corporations (government-owned), public corporations (publicly traded shares), private corporations (private or close ownership).

Unit 1, Lesson 1.7: What Businesses Do?

• Primary Industries: Extract natural resources (fishing, farming).

• Secondary/Processing Industries: Transform raw materials into finished products (steelmaking).

• Tertiary/Service Industries: Offer services (accounting, logistics).

• Business Services: Services for other businesses (accounting, legal).

• Consumer Services: Services directly for consumers (restaurants, retail).

• B2B: Business sells to another business;

• B2C: Business sells to consumer/end user

• Wholesale: Buy from producers, sell to retailers.

• Importers: Bring products from other countries into a country.

• Retailers: Sell directly to consumers.

Unit 1, Lesson 1.8: Introduction to Business Ethics

• Ethics/Ethical Behaviour: Moral principles/acting honestly and justly.

Unit 1, Lesson 1.9: Business Ethics (Continued)

• Unethical Business Practices: Bait-and-switch, misleading advertising, faulty products, pressure sales, and exploitation.

• Bribery/Theft/Fraud: Defined as intentional unethical activities.

• Reprimanding Unethical Behavior: Varies from dismissal/counseling to prosecution.

Unit 1, Lesson 1.10: Corporate Social Responsibility (CSR)

• CSR: Principles and practices to enhance community well-being.

• Stakeholder: Anyone affected by or affecting a business.

• CSR Movement Starting: Desire from businesses for increased social responsibility.

Unit 2, Lesson 2.1: International Business

• Exploitation: Taking unfair advantage of vulnerable people for profit.

• Sustainable Development: Using resources wisely without harming future generations.

• Containerization: Shipping goods in standardized containers.

• Outsourcing: Hiring outside service providers for specific tasks.

• Benefits of International Trade: Access to markets, lower labor costs, more diverse products.

• Social Costs of International Trade: Offshore outsourcing, labor abuse, and environmental damage.

Unit 2, Lesson 2.2: Competitive Market Structures

• Market Structures: Perfect Competition (many similar products), Monopoly (one seller), Monopolistic Competition (many differentiated products), Oligopoly (few large sellers).

Unit 2, Lesson 2.3: Government Intervention in Markets

• Price Floors: Minimum prices to protect producers.

• Price Ceilings: Maximum prices to benefit consumers.

• Minimum Wage Laws: Mandated minimum hourly wage.

• Market Failure: Inefficient resource allocation in a market.

• Government Intervention Strategies: Subsidies, targeted assistance, and progressive taxation.

Unit 3: Business Leadership and Project Management

• Management Levels: Corporate, Middle, Department. Each exercises distinct powers.

• Management Categories: Planning, organizing, leading, and controlling.

• Leadership Styles : Laissez-faire, democratic, autocratic.

Unit 3, Lesson 3.2: Project Management

• Project Management: Planning and organizing resources for task completion.

• KPI: Key Performance Indicator

Unit 4: The Functions of a Business

Unit 4, Lesson 4.1: Factors of Production

• Factors of Production: Natural Resources, Labour, Capital, Information, and Management. Describe each component.

Unit 4, Lesson 4.2: Production Steps & Productivity

• Production Steps: Purchasing, grading, processing, and quality control.

• Improving Productivity: Capital investment, technology upgrades, inventory systems (JIT), and employee training.

• Ethical/Sustainable Production: Eco-friendly materials, waste reduction, and fair labor practices.

Unit 4, Lesson 4.3: The Marketing Concept (2 Cs)

• Consumers: People interested in a company's goods/services. Demographics/Psychographics affect consumer behavior.

• Competitors: Businesses vying for the same customers. Indirect/direct competitors compete in different/same categories. Market share reflects success.

Unit 4, Lesson 4.4: Marketing (4 Ps)

• Marketing Mix: Product, price, promotion, and place considerations for effective marketing.

• Target Market: Specific customer groups a business aims to reach.

• Product Characteristics: Tangible/Intangible, USP (unique selling proposition), market research.

• Place Details: Various channels e.g. online/physical stores

• Promotion: Advertising, sales promotions, discounts, direct marketing, social media, influencers.

Unit 4, Lesson 4.5: HR Functions & Rights/Responsibilities

• HR Duties: Recruitment, staffing planning, employee development.

• Performance Appraisal: Formal evaluations documenting employee performance & providing feedback (employee improvements & promotions).

• Employee Retention: Compensation, health/safety, wellness programs, development opportunities.

• HR Role in Departures/Dismissals/Retirement: Managing transitions.

• DEI Department: Promoting ethical practices by fostering fairness and respect.

• Employer Rights/Responsibilities: Minimum wage, hours, vacation pay/provide safe working environment, employee engagement.

Unit 5: Finance

Unit 5, Lesson 5.1: Accounting and Break-Even Analysis

• Financial vs. Managerial Accounting: Financial accounting reports on past transactions; managerial accounting reports for future decision making.
• Break-Even Analysis: Cost analysis showing the point where total revenue equals total expenses.

Unit 5, Lesson 5.2: Income Statements

• Income Statement: Financial statement reflecting business profit (or loss) over a specific time period (week/month/quarter/year).
• Revenue: Inflow of funds from sales.
• Expenses: Outflows of funds spent on operational needs.