BUSAD 250 Study Guide - Final Guide: Competitive Advantage, Profit Motive, Social Environment
29 Apr 2018
School
Department
Course
Professor
BUSAD 250 Final Exam Spring 2018
• Not-for-profit organizations: organizations that provide goods and services without
having a profit motive; these are also called nonprofit organizations.
• Goods-producing businesses: companies that create value by making “things,” most of
which are tangible.
• Service businesses: companies that create value by performing activities that deliver
some benefit to customers.
• Competitive advantage: some aspect of a product or company that makes it more
appealing to its target customers.
• Barrier to entry: any resource or capability a company must have before it can start
competing in a given market.
• Goods-producing businesses are often capital-intensive businesses.
• Service businesses tend to be labor-intensive businesses.
• Social environment: trends and forces in society at large.
• Technological environment: forces resulting from the practical application of science to
innovations, products, and processes.
• Economic environment: the conditions and forces that affect the cost and availability of
goods, services, and labor and thereby shape the behavior of buyers and sellers.
• Legal and regulatory environment: laws and regulations at local, state, national, and even
international levels.
• Market environment: a company’s target customers, the buying influences that shape the
behavior of those customers, and competitors that market similar products to those
customers.
• Stakeholders: internal and external groups affected by a company’s decisions and
activities.
• Organization structure: a framework that enables managers to divide responsibilities,
ensure employee accountability, and distribute the decision-making authority.
• Agile organization: a company whose structure, policies, and capabilities allow
employees to respond quickly to customer needs and changes in the business
environment.
• Line organization: a chain of command system that establishes a clear line of authority
flowing from the top down.
• Line-and-staff organization: an organization system that has a clear chain of command
but that also includes functional groups of people who provide advice and specialized
services.
• Unstructured organization: an organization that doesn’t have a conventional structure but
instead assembles talent as needed from the open market; the virtual and networked
organizational concepts taken to the extreme.
• Advantages of working on teams: higher quality decisions; increased diversity of views;
increased commitment to solutions and changes; lower levels of stress and destructive
internal competition; improved flexibility and responsiveness.
find more resources at oneclass.com
find more resources at oneclass.com
• Disadvantages of working on teams: inefficiency; groupthink; diminished individual
motivation; structural disruption; excessive workloads.
• Characteristics of effective teams: clear sense of purpose; open and honest
communication; creative thinking; accountability; focus; decision by consensus.
• Team development: forming, storming, norming, performing, adjourning.
• As price increases demand from consumers decreases, but supply from producers
increases. And as price decreases demand from consumers increases, but supply from
producers decreases.
• Pure competition: many small suppliers; virtually identical products; low barriers to
entry.
• Monopolistic competition: can have few or many suppliers, or varying size; products can
be distinguished but are similar enough to be replacements; variable barriers to entry but
market open to all.
• Oligopoly: small number of suppliers, even as few as just two (a duopoly); products can
be distinguished in important ways, but replacements are still available; barriers to entry
tend to be high, making entering the market difficult.
• Pure monopoly: only one supplier in a given market; monopoly achieved without
government intervention, but innovation, specialization, exclusive contracts, or a simple
lack of competitors; products are unique, with no direct replacements available; barriers
to entry are extremely high, making entering the market difficult or impossible.
• Regulated monopoly: only one supplier in a given market; monopoly granted by
government mandate, such as a license to provide cable TV and internet service; no
product competition is allowed; barriers to entry are infinitely high, new competitors are
not allowed.
• Monetary policy: government policy and actions taken by the Federal Reserve Board to
regulate the nation’s money supply. (stimulating)
• Fiscal policy: strategy for the use of government revenue collection and spending to
influence the business cycle. (stabilizing)
• Leading indicators: signal future events.
• Lagging indicators: follow an event.
• Assets – Liabilities = Owners’ equity.
• Balance sheet: a statement of a firm’s financial position on a particular date; also known
as a statement of financial position.
• Income statement: a financial record of a company’s revenues, expenses, and profits over
a given period of time; also known as a profit and loss statement.
• Sales: The activity or business of selling products or services.
• Contribution Margin: a measure of the ability of a company to cover variable costs with
revenue. (Price per unit - cost per unit - variable operating expenses per unit)
• Net income: is a company's total earnings. (total revenue – all expenses)
• Financial accounting: the area of accounting concerned with preparing financial
information for users outside the organization.
find more resources at oneclass.com
find more resources at oneclass.com
