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Chapter 1

MGTA01H3 Chapter Notes - Chapter 1: Izzy Asper, Manulife, Canadian Business


Department
Management (MGT)
Course Code
MGTA01H3
Professor
Mc Conkey& Bovaird
Chapter
1

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MGTA03 - C1
CHAPTER 1 - UNDERSTANDING CANADIAN BUSINESS SYSTEM
THE CONCEPT OF BUSINESS & PROFIT, p5
Business
BUSINESS - organization that strives to earn profit by producing & selling goods/services
PROFIT - $ remaining (if at all) after subtracting the business's revenue by the business's
expenses
   
- are the "reward" the business owners get for taking risks dealing with investing time & $
- given the business is managed well, the amt can be large
- ex. RBC - $3.3bil; Manulife Financial - $3.2bil; Imperial Oil Ltd - $2.6bil.
EXPENSES - aka "costs"; $ business spends for prod'ing goods & services, and for running the
business
REVENUE - aka "sales"; $ earned by business after selling its prod's & services
Business in Canadian Economic System (2)
- exist for the owners who are free to set them up to earn profits
- must consider the consumer's demands (ie. want/needs) when going for profits, as they have
freedom of choice
- ie. can choose to buy or not buy
=> if there is no demand for goods or services that a business offers, then business will not be
successful, regardless of how efficient it may be at prod'ing them
- ex. snow-blower shop set up near equator, or skirt-shop set up in Antarctica
Business (3)
- businesses can be successful if they
a) offer the consumer needs that are not met by other businesses
or
b) have better ways to satisfy the consumer's neds
- oppurtunity to succed, if no one else is supplying that need, or other businesses are not
providing it efficiently or completely

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THE CONCEPT OF BUSINESS & PROFIT, p6
Businesses
- prod. majority of goods & services ppl consume and employ most working ppl
- potential to introduce new innovations
- can provide oppurtunities for other businesses, which are their suppliers
- quality of business situation affects quality of life & standard of living
- prod'ion, consumption & employmt are guaranteed to grow on and on given new forms of:
- tchnology
- service businesses
- international oppurtunties.
.. arise
- business profits
- can improve personal income of numerous owners & stockholders
- business taxes
- help to support gov. at any lvl
- other businesses support charities, provide community leadership
Chapter
- introduces Canadian business via learning about its role on economy & society
- how do the dominant economic sys's work?
- what effect do Canadian businesses have (if any)?
ECONOMIC SYSTEMS AROUND THE WORLD, p6
- businesses are diff. from one country to another in many ways
- key dictator of how organizations operate is the type of economic sys. that their country they do
business in is
ECONOMIC SYSTEM - way in which nation allocates its resources among its civilians
- "factors of production" - who owns & controls resources
- makes one economic sys. differ from another
Factors of Production, p6
FACTORS OF PRODUCTION
= basic resources used by a country's businesses to produce goods & services
1. LABOUR
= mental & phys. capabilities & talents of ppl
- aka human resources
- ppl who work for company

Only pages 1-3 are available for preview. Some parts have been intentionally blurred.

- ex. Imperial Oil
- huge company
- req. its labour department consisting of ppl w/ various skills
- ex. managers, geologists, truck drivers
- company can attain a true competitive advantage over other companies if its employees are
- well trained
- knowledgable
2. CAPITAL
= financial resources (aka funds) req. to run an enterprise (aka organization/business)
- needed
- for obtaining & using resources, ex. labour
- to begin a new business
- to keep business progressing and ongoing
- ex. Inco
- req. $mil. to run its operations, buy & replace new equipment
- small businesses have personal investment by owners as a major source of capital
- coming from individual entrepreneurs, partners who begin business together, or
investors who purchase stock
- IMPT & ongoing source of capital as soon as business starts
= revenue coming from selling prod's
3. ENTREPRENUERS
= person who organizes & manages labour, capital & natural resources to earn a profit by
prod'ing goods & services, but also has risk of failure
- those ppl that accept the oppurtunties & risks that're assoc. w/ running a business
- ex. Jimmy Pattison, Izzy Asper
- ex. AOL creator Jimmy Kimsey
- technical skills to comprehend the mechanics of the internet (labour)
- conceptual skills to realize its future potential (labour)
- had the skill to make correct decisions, while being risky
4. NATURAL RESOURCES
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