Week 2. Ferrell_12e_PPT_Ch01 - The Dynamic of Business - 110921.pptx

Ferell

1. MGMT6011 Introduction to Management and Business The Dynamics of Business and Economics Week 2 Dr. Nurianna Thoha , MBA nurianna @binus.edu

2. Learning Objectives 1-1 Define basic concepts such as business, product, and profit. 1-2 Identify the main participants and activities of business and explain why studying business is important. 1-3 Describe the role of supply, demand, and competition in a free-enterprise system. 1-4 Evaluate a small-business owner’s situation and propose a course of action.

3. The Nature of Business 1 Businesses try to earn profits by providing products that satisfy people’s needs Products include: Tangible goods Automobile, smartphone, pair of jeans Service Dry cleaning, doctor’s visit, movie Idea Accountants and attorneys provide ideas for solving problems

4. The Nature of Business - Product

5. The Nature of Business - Services

6. The Nature of Business 2 The Goal of a Business: to earn a profit Nonprofit organizations Do not share the purpose of earning profits May provide goods or services Engage in fund-raising Engage in management, marketing, and finance to reach goals Stakeholders

7. The Nature of Business 3 The People and Activities of Business Management Involves the functions of planning, organizing, leading, and controlling Marketing Focus of all marketing activities is satisfying customers Finance Refers to all activities concerned with obtaining money and using it effectively

8. Figure 1.1 Overview of the Business World Access the text alternative for these images.

9. Figure 1.1 Overview of the Business World Access the text alternative for these images. https://www.youtube.com/watch?v=tfGUJowHOPM

10. The Nature of Business 4 Why Study Business? Help you develop skills and acquire knowledge to prepare for your future career Help you understand activities needed to provide goods and services Help you become a well-informed consumer and member of society

11. What do you feel is the most significant macro -environmental factor that impacts businesses? Technology Politics/Legal Issues Sociocultural Economic POLLING QUESTION

12. The Economic Foundations of Business 1 What is economics? Resources Natural resources Human resources (also called labor) Financial resources (also called capital) Intangible resources

13. The Economic Foundations of Business 3 The Free-Enterprise System Many large economies are free-enterprise, such as U.S., Canada, and Japan Many communist and socialist countries apply free-enterprise principles, such as China and Russia Allows a company to succeed or fail on the basis of market demand

14. The Economic Foundations of Business 4 The Free-Enterprise System continued Basic individual and business rights must exist in order for free enterprise to work Right to own property Right to earn profits and use them as one wishes Right to determine business operations Right to choose a career, where to live or locate a business, what goods/services to purchase, and more

15. The Economic Foundations of Business 5 The Forces of Supply and Demand Demand Supply Equilibrium price

16. The Economic Foundations of Business 5

17. Figure 1.2 Equilibrium Price of Handmade Rugs Access the text alternative for these images.

18. The Economic Foundations of Business 6 The Nature of Competition Competition Four types of competitive environments: Pure competition Monopolistic competition Oligopoly Monopoly

19. The airline industry is part of what type of competitive environment? Pure competition Monopolistic competition Oligopoly Monopoly POLLING QUESTION

20. The Economic Foundations of Business 7 Economic Cycles and Productivity Economic expansion Inflation Economic contraction Recession Unemployment Depression

21. Figure 1.3 Annual Average Unemployment Rate, Civilian Labor Force, 16 Years and Over Access the text alternative for these images. Sources: Bureau of Labor Statistics , “Labor Force Statistics from the Current Population Survey,” http://data.bls.gov/timeseries/LNS14000000 (accessed March 25, 2018).

22. The Economic Foundations of Business 8 Economic Cycles and Productivity continued Measuring the economy Gross domestic product (GDP) Budget deficit

23. Figure 1.4 Growth in U.S. Gross Domestic Product Access the text alternative for these images. Source: U.S. Department of Commerce Bureau of Economic Analysis, “National Economic Accounts,” www.bea.gov/national/index.htm#gdp (accessed March 25, 2018).

24. Table 1.3 How Do We Evaluate Our Nation’s Economy? Unit of Measure Description Trade balance The difference between our exports and our imports. If the balance is negative, as it has been since the mid-1980s, it is called a trade deficit and is generally viewed as unhealthy for our economy. Consumer Price Index Measures changes in prices of goods and services purchased for consumption by typical urban households. Per capita income Indicates the income level of “average” Americans. Useful in determining how much “average” consumers spend and how much money Americans are earning. Unemployment rate Indicates how many working-age Americans are not working who otherwise want to work. Inflation Monitors price increases in consumer goods and services over specified periods of time. Used to determine if costs of goods and services are exceeding worker compensation over time. Worker productivity The amount of goods and services produced for each hour worked.

25. Figure 1.6 Online Retailing and E-Commerce Source: Aaron Smith and Monica Anderson, “Online Shopping and E-Commerce,” Pew Research Center, December 19, 2016, http://www .pewinternet.org/2016/12/19/online-shopping-and-e-commerce/ (accessed March 25, 2018).

26. The American Economy 4 The Role of the Entrepreneur Risk their wealth, time, and effort to develop for profit an innovative product or way of doing something Let the free-enterprise system help them to succeed Change business practices through new technology and innovative management techniques

27. Mobile Payment Systems ©How Hwee Young/Epa/REX/Shutterstock Apple Pay is a mobile payment system that allows users to store their credit card or debit card information. When checking out at stores, users can bring up their credit card with two taps and use the information to pay for their purchases.

28. Mobile Payment Systems ©How Hwee Young/Epa/REX/Shutterstock Go Pay for Indonesia. Go Pay also enables people to pay any daily expenditure through this platform.

29. The American Economy 6 The Role of Ethics and Social Responsibility in Business Promote public confidence in corporate America Foster business ethics Encourage socially responsible behavior Push for diversity in workforce Enhance reputation and drive profits

30. Socially Responsible Behavior © asiseeit /Getty Images Many companies engage in socially responsible behavior to give back to their communities. Bank of America partners with Habitat for Humanity to build home for disadvantaged families.

31. Socially Responsible Behavior © asiseeit /Getty Images https://www.youtube.com/watch?v=WcR-V3vdhG8

32. Can You Learn Business in a Classroom? Absolutely! To be successful in business you need: Knowledge Skills Experience Good judgment