Class Notes (809,049)
Canada (493,506)
BUS 201 (80)

Ch 1 Terms

8 Pages
Unlock Document

Simon Fraser University
Business Administration
BUS 201
Maureen Fizzel

Chapter 1 – The Canadian Business System Bus 201 Business Essentials Chapter 1 – The Canadian Business System Business An organization that seeks to earn profits by providing goods and services Profit What remains after a business’s expenses are subtracted from its sales revenues Not-For-Profit Organization An organization that provides goods and services to customers, but does not seek to make a profit while doing so Economic System The way in which a nation allocates its resources among its citizens – economic systems differ in terms of who owns and controls these resources, known as Factors of Production (Ex. a Canadian business is different from one in China) Factors of Production The resources used to produce goods and services: labour, capital, entrepreneurs, and natural resources Labour The mental and physical training and talents of people; sometimes called human resources Capital The funds needed to operate an enterprise Entrepreneur An individual who organizes and manages labour, capital, and natural resources to produce goods and services to earn a profit, but who also runs the risk of failure Natural Resources Items used in the production of goods and services in their natural state Information Resources Information such as market forecasts, economic data, and specialized knowledge of employees that is useful to a business and that helps it achieve its goals Chapter 1 – The Canadian Business System Types of Economic Systems Different types of economic systems manage the factors of production in different ways Input Market Firms buy resources that they need in the production of goods and services Output Market Firms supply goods and services in response to demand on the part of consumers Market An exchange process between buyers and sellers of a particular good or service Market Economy An economic system in which individuals control all/most factors of production and make all/ most production decisions Command Economy An economic system in which government controls all/most factors of production and makes all/most production decisions Communism A type of command economy in which the government owns and operates all industries Socialism A kind of command economy in which the government owns and operates the main industries, while individuals own and operate less crucial industries Capitalism An economic system in which markets decide what, when, and for whom to produce Mixed Market Economy An economic system with elements of both a command economy and a market economy; in practice, typical of most nations’ economies Privatization The transfer of activities from the government to the private sector Nationalization The transfer of activities from private firms to the government Deregulation A reduction in the number of laws affecting business activity Chapter 1 – The Canadian Business System Interaction between Business and Government The government can act as a Customer, Competitor, Regulator, Taxation Agent, Provider of Incentives and Financial Assistance, and Provider of Essential Services Gov’t as Customer Government buys different products and services from business (office buildings, computers, battleships, highways, water treatment plants). Many Businesses depend on the government to buy their products Gov’t as Competitor Gov’t compete with business (Crown Corporations) such as Canada Post, Hydro BC, Canadian Wheat Board Gov’t as Regulator Gov’t as a regulator tries to Promote Competition, Protect Customers & the Environment, and tries to Achieve Social Goals through Administrative Boards, Tribunals, and Commissions Canadian Radio-Television and Telecommunications Commission (CRTC) Regulates and supervises all aspects of the Canadian broadcasting system (Gov’t as regulator) Canadian Wheat Board Regulates the price farmers receive for their wheat (Gov’t as regulator) Hazardous Products Act Regulates banned products and products that can be sold but must be labelled hazardous Tobacco Act Prohibits cigarette advertising on billboards and in retail stores, and assigns financial penalties to violators Weight and Measures Act Sets standards of accuracy for weighing and measuring devices Textile Labelling Act Regulates the labelling, sale, importation, and advertising of consumer textile articles Chapter 1 – The Canadian Business System Food and Drug Act Prohibits the sale of food unfit for human consumption and regulates food advertising Canada Water Act Controls water quality in fresh and marine waters of Canada Fisheries Act Regulates the discharge of harmful substances into water Environmental Contaminants Act Establishes regulations for airborne substances that are a danger to human health or to the environment Gov’t as Taxation Agent Revenue Taxes Taxes whose main purpose is of fund government services and programs Progressive Revenue Taxes Taxes levied at a higher rate on higher-income taxpayer and at a lower rate on lower-income taxpayers Regressive Revenue Taxes Taxes that cause poorer people to pay a higher percentage of income than richer people pay Restrictive Taxes Taxes levied to control certain activities that legislators believe should be controlled Gov’t as Provider of Incentives and Financial Assistance Gov’t offers incentive programs that attem
More Less

Related notes for BUS 201

Log In


Don't have an account?

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.