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BUS 201 (122)
Chapter 1

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Department
Business Administration
Course
BUS 201
Professor
Maureen Fizzell
Semester
Fall

Description
Chapter 1 Understanding the Canadian Business SystemThe Idea of Business and Profit business managers must pay attention to many different things including the actions of competitors rapid technological change new product development corporate strategy risk management stock prices Business is an organization that produces or sells goods or services in an effort to make a profit Profit is what remains after a businesss expenses have been subtracted from its revenues prospect of earning profits is what encourages people to start and expand businesses Notforprofit organizationsan organization that seeks to earn profits by providing goods and servicesEconomic Systems Around the World a major determinant of how organizations operate is the kind of economic system that characterizes the country in which they do business economic system allocates a nations resources among its citizensFactors of Production factors of production the resources used to produce goods and services labour capital entrepreneurs and natural resources1 Laboursthe mental and physical training and talents of people human resources 2 Capital the funds needed to operate an enterprise 3 Entrepreneurs 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 a failure4 Natural Resources items used in the production of goods and services in their natural state including land water mineral deposits and trees 5 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 Types of Economic Systems some systems ownership is private factors of production are owned by the government command economy an economic system in which government controls all or most factors of production and makes all or most production decisionsmarket economy an economic system in which individuals control all or most factors of production and make all or most production decisions 1 Command economiestwo basic forms communism and socialismcommunism is a type of command economy in which the government owns and operates all industriesless extensive command economic system socialism a kind of command economy in which the government owns and operates the main industries while individuals own and operate less crucial industriesmany government operated enterprises are inefficient since management positions are frequently filled based on political considerations rather than abilityextensive public welfare systems have also resulted in very high taxessocialism is generally declining in popularity 2 Market Economicsa market is a mechanism for exchan
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