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Objectives

Identify economic needs and wants. Describe the three uses of money. Explain how business satisfies

economic needs. Describe the three forms of business

ownership.

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Objectives

Describe the difference between a for-profit corporation and a nonprofit corporation.

List the four functions of business and give an example of each.

Explain the role of marketing in business.

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Marketing Terms

need want economic needs

and wants economic goods

and services exchange money value

business profit sole proprietorship partnership corporation nonprofit corporation production finance management

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Economic Needs and Wants

Need necessary for

survival

Want something you

would like, but you could survive without it

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Economic Needs and Wants

Economic needs and wants can be satisfied by buying

something

What are some of your economic wants and needs?

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Economic Needs and Wants

The items you buyto satisfy economic needs and wants are economic goods

and services

Name some economic goods and services.

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Economic Needs and Wants

Some needs and wants cannot be satisfied by buying

something

What are some needs and wants that cannot be satisfied by buying something?

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The Exchange

An exchange is a trade

Exchanges are the basis of all business

Describe an exchange you made.

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Money

Money consistent item that people

accept in exchange for goods or work

Describe American money. How is it consistent?

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Money

Without money modern business could not exist

Money is used in three ways medium of exchange unit of value store of wealth

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Medium of Exchange

Money is a convenient medium of exchange

Paper money and coins are easy to carry

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Unit of Value

Money can express the exact value of an item

– the dollar is the unit of value in the United States

The value of a product expressed in dollars

– is the price

Marketers use price to set the value of a product

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Store of Wealth

Money is easy to store You can save money until

you need it

Why do people save money?

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What Is Business?

Business general term for activities

– involved in the development and exchange of products

The term business also refers to a person or group of people

– involved in the development and exchange of products

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What Is Business?

Other terms for business firm, company,

organization, corporation, and enterprise

Describe some businesses in your neighborhood.

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What Is Business?

Business powers the economy Money flows from businesses to

workers then from the workers back to the

businesses Business provides

goods and services you use everyday wages (money) people use to buy goods

and services

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Business

Money

Money

Payment for goods and services

Payment of salary, wages, and profits

Workers

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Goal of Business Businesses aim to make a profit.

Sales Costs andExpenses Profit

What is profit?

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Forms of Business Ownership

Sole proprietorship business owned by one person

– who gets all profits and bears all risks

Partnership owned by small number of people,

usually two or three– who share profits and risks

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What Is a Corporation?

A corporation is a legal entity

established for the purpose of doing business

exists separate from the people who own it

is owned by stockholders

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What Is a Corporation?

A corporation can buy property, manufacture products, earn

money, lose money, sue, and be sued A corporation offers limited liability to its

shareholders if a corporation is sued, the corporation

pays damages from its income– the shareholders (owners) do not pay

Name some corporations.

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What Is a Nonprofit Corporation?

There are two types of corporations for-profit nonprofit

Goal of a for-profit corporation is to make a profit for its owners

Goal of a nonprofit is to benefit society

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What Is a Nonprofit Corporation?

A nonprofit corporation is a legal entity, like a for-profit corporation is established to provide a benefit to society can make a profit, but . . . any profit that a nonprofit corporation earns

goes back to support its cause or benefit Examples of benefits or causes

charity, education, medical research, youth activities, religion, and the arts

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What Is a Nonprofit Corporation?

Examples DECA American

Cancer Society Goodwill

Name some other nonprofit corporations.

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The Functions of Business

Four functions of business production

– making products finance

– handling money marketing

– focusing on customers management

– planning, coordinating, monitoring

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Production

For goods, production includes farming mining construction manufacturing

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Production

For services, production is often the service itself Examples

– TV production– hair styling

Describe production that you have seen.

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Finance

Finance includes planning and

budgeting accounting

– paying bills– receiving

payments– keeping track of

transactions

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Marketing

Marketing helps the business focus on the customer

Marketing includes selling promotion pricing learning about

customers

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Management

Management includes planning coordinating monitoring supervising

Managers look at the big picture and lead workers to make the business better

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Review

Explain the three uses of money. What are the three forms of business

ownership? What are the four functions of

business? What is the role of marketing in

business?

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Glossary

business. General term for all the activities involved in the development and exchange of products. Also used to refer to a specific person or group of people who are involved in the development and exchange of products; also called firm, company, organization, corporation, or enterprise.

corporation. Legal entity established for the purpose of doing business.

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Glossary

economic goods and services. Products that you buy to satisfy economic needs.

economic needs and wants. Needs and wants that you can satisfy by buying something.

exchange. To trade something of value for something you want.

finance. The function of business that includes all activities involving money.

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Glossary

management. The function of business that includes all the activities required to plan, coordinate, and monitor a business.

money. A consistent item that people accept in exchange for goods or work.

need. Something that is necessary for survival.

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Glossary

nonprofit corporation. Legal entity, like a for-profit corporation; however, instead of profit, its main goal is to achieve something to benefit society; also called nonprofit, nonprofit organization, or not-for-profit organization.

partnership. Business owned by a small number of people, usually two or three.

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Glossary

production. Any activity related to making a product (good, service, or idea).

profit. Money that a business has left after all the expenses and costs of running the business are paid.

sole proprietorship. Business owned by one person.

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Glossary

value. How much something is worth. want. Something you desire but you

could function without.