Textbook Notes (363,103)
Canada (158,195)
MGTA01H3 (583)
Chapter 1-5

Chapter 1-5 notes from Business Volume One second custom edition

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University of Toronto Scarborough
Management (MGT)
Chris Bovaird

Management Chapter 1-5 Textbook Notes (Review) Chapter One: Introducing the Contemporary Business World Factors of Production Labour The mental and physical training and talents of people; sometimes called human resourc Capital The funds needed to operate a business Entrepreneurs The people who start and operate a business knowing very well the risks involved. Organizes and manages labour, capital and natural resources Natural Resources Items used in the production of goods and services in their natural state. Ex. Land, water, mineral deposits and trees Information Resources Include market forecasts, specialized expertise and knowledge of people, various forms o economic data. Businesses rely heavily on such resources Types of Economic Systems Command Economies Government controls all or most of the factors of production and makes all or most of the production decisions Two most basic forms incC luome: unism & Socialism Communism: System in which the government owns and operates all factors of production. Socialism: System in which the government owns and operates only selected major industries. Market Economies www.notesolution.com Market: a mechanism for exchange between the buyers and sellers of a particular good or service. Both buyers and sellers enjoy freedom of choice pertaining to the price of the goodservi and where to buy from Capitalism: a type of market economy offering private ownership of the factors of production and of profits from business activity. Mixed Market Economy A system featuring characteristics of both command and market economies. Privatization: The transfer of activities from the government to the private sector. Revenue Taxes: Taxes that fund government services and programs Progressive Revenue Taxes: Taxes that are levied at a higher rate for high-income taxpayers, and at a lower rate for low-income taxpayers. Regressive Revenue Taxes: (Ex. Sales tax) are levied at the same rate regardless of a persons income. Restrictive Taxes: (Ex. taxes on alcohol, tobacco, and gasoline) are levied partially for the revenue they provide. Private Enterprise and Competition in a Market Economy Private Property Rights: Ownership of the resources used to create wealth is in the hands of individuals. Freedom of Choice: You can sell your labour to any employer you choose and choose what products to buy, and producers can choose whom to hire and what to produce. Profits: influence individuals choices of which good or service to produce. Competition. Degrees of Competition Perfect Competition All firms are small There are a lot of firms in the industry Similar products in each firm www.notesolution.com
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