Textbook Notes (363,062)
Canada (158,169)
MGTA01H3 (583)
Chapter 1

Management Chapter 1.docx

6 Pages
Unlock Document

University of Toronto Scarborough
Management (MGT)
Bill Mc Conkey

Management Chapter 1 Definition of Business  An organized effort to make or sell something to customers who need or want something in order to make profit  A lot of organizations don’t have profit motive eg family, church, schools  Profit: revenue- expenses  A company’s profit can be used to make more of the product and can invest in research and employ people  Customers, employees, and investors benefit from profit.  A person that can plan and offer promising opportunity and being able to follow it through can succeed.  Business produces most of the goods and services we consume, employees people, provides business to other businesses.  Dependent upon the wealth and living standard of people  Technology, service business and international opportunities promise to keep production, consumption and employment growing. Economic systems around the world - A Canadian business is different in many ways through out each country since its dependent on type of economic system in that country. Factors of Production -the key difference between the economic systems is the way they manage the factors of production. -Factors of Production: the basic resources that a country’s business use to produce goods and services. It includes: labour, capital, entrepreneurs and neutral resources. 1. Labour -Mental and physical capabilities of people. - humans as part of production - people that are well trained and knowledgeable can be real competitive advantage for a company. 2. Capital -obtaining and using labour and other resources require capital Capital: the funds needed to operate an enterprise -major source of capital for a small business is owners personal investment -investment can come from individual entrepreneurs or investors who buy stocks. 3. Enterprises -The people who accept the opportunities and risks involved in creating and operating businesses and entrepreneurs. 4. Natural Resources -Land, water, mineral deposits and threes -all physical resources eg: in order to obtain oil, land that contains oil must be found where refineries and pipelines can be placed. 5. Information resources - Information suck as market forecasts, economic data and specialized knowledge of employees that is useful to a business and that helps it achieve its goals. - for example, a lot of businesses provide services for many people to exchange information. Types of Economic systems - Different types of economics systems manage the factors of production in different ways. - Economies differ in the way that decisions are made about production and allocation. - There are various different types 1. Command Economies -the government owns and operates all sources of production and makes most of the decisions - Two types: communism and socialism. a. Communism: is a system in which the government owns and operates all sources of production b. socialism: a kind of command economy in which the government owns and operates the main industries, while individuals own and operate less crucial industries.  Small business such as clothing stores and restaurants may be privately owned  Usually allowed to choose profession but most work for government  People working for the government are selected based on political view rather than qualifications causing inefficiency of enterprises 2. Market Economy -a mechanism for exchange between buyers and sellers of a particular good or service -individual owns/controls factors of production - Buyers and sellers are free to price/ produce what they wish -Capitalism: a kind of market economy offering private ownership of the factors of production and of profits from business activity. -enterprises are allowed to decide what to build, price and how much to 3. Mixed Market Economy -Individuals own/ control majority of factors individuals make most of the economic decisions. - eg: government regulates tax, run some business ( medicine sector, alcohol) -adopted market mechanisms through a process called Privatization -Privatization: the government hands over a business to private companies to run with a profit motive and more efficiently. -another trend is deregulation: a reduction in number of laws affecting business activity. Interactions between business and government 1. Government as customers - government buys thousands of products and services form businesses while many businesses depend on government as their main supplier. - eg: battleships, helicopters, highways and water treatments 2. Government as a competitor - government competes with businesses through Crow corporations 3. Government as a regulator - Federal and provincial government regulate many aspects of business activity. - Government regulates: Canadian Radio-Television and telecommunications commission - Reasons for regulating act
More Less

Related notes for MGTA01H3

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.