Sessions 1 & 2 Quiz - Business Studies PDF

[Firm:] profit or non-profit organization/company/business/enterprise that supplies goods and services that maximizes profits Management ≠ Economics ### SESSION 2 [Reading : **Chapter 1 notes "Developing a Business Mindset"**] A [business] is a profit seeking organization that provides goods and...

[Firm:] profit or non-profit organization/company/business/enterprise that supplies goods and services that maximizes profits Management ≠ Economics ### SESSION 2 [Reading : **Chapter 1 notes "Developing a Business Mindset"**] A [business] is a profit seeking organization that provides goods and services designed to satisfy customers needs **Revenue**: money company brings in through the sale of goods and services **Business Model:** concise description of how a business generates or intends to generate revenue → how companies make money (price, quality, cost) **Profit**: Money left over after all the costs involved in doing business have been deducted from the revenue Each company seeks to have a competitive advantage that makes its product more appealing to customers All businesses accept risks in the pursuit of rewards- this is for 2 reasons - - There are a diverse range of different business types, there are 4 ways to categorize businesses: 1. 2. 3. 4. Businesses have the potential to benefit society in many ways although there are also many negatives that are generated such as the following: - - - - Every business operates in an environment that continuously creates both opportunities and constraints - - - - - - - - - - **Barriers to entry**: resources or capabilities a company must have before it can start competing in a given market [6 major functional areas in a business enterprise:] 1. 2. 3. 4. 5. 6. [7 most important business professions:] 1. 2. 3. 4. 5. 6. 7. [Elements of professionalism]: beth the best, dependable, team player, respectful, clear ethical **Digital enterprise:** any company that uses digital systems as one of the foundations of its value creation processes regardless of what industry or what product it makes Digital transformation: Class notes: **Organization**: group of people with the purpose (goals) and structure (means) [Maslow\'s hierarchy of needs:]  Different companies try to serve these needs in order to value customers through their businesses **Two-sided business model:** ex. Instagram- it is free but in return you are giving them your data (they get paid through external companies that give sponsors) Revenue = Price x Quantity - Cost **Cost leadership strategies:** Low price and high quantity: Costco, Ryanair, Fast fashion High price and low quantity: Luxury goods (ex. Hermes) **Goods**: capital intensive **Services**: labor intensive **Moral Hazard** (risk/reward link is broken)**:**\ When you take a risk but someone else pays for it