37 terms

Ch 4 Business in the Free Enterprise

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For-profit business
an organization that generates revenue
Not-for-profit organization
an organization that exists to serve some public purpose
Public sector
governmental organizations, schools, and the military that provide goods and services
Private sector
non-government organizations that provide goods and services
Producers
businesses that create goods and services
Extractors
businesses or people that take natural resources from the land
Manufacturers
businesses that use supplies from other producers to make products
Farmers
raise crops and livestock to sell either to end users or other producers
Intermediaries
people and businesses that sell the goods and services from producers to customers
Wholesalers
purchase large quantities of products directly from producers and sell the products in smaller quantities to retailers
Retailers
buy products from wholesalers or directly from producers and sell them to consumers to make a profit
Service business
earns profits by providing consumers with services that meet their needs and wants
North American Industry Classification System (NAICS)
numeric system used to classify businesses and collect economic statistics
Customer
an individual or group who buys products
client
an individual or group who buys a service
Consumer market
consists of customers who buy products for their own use
business-to-consumer (B2C)
Businesses that sell primarily to individual consumers
Business market
consists of customers who buy products for use in a business
business-to-business (B2B)
Businesses that sell primarily to other businesses
Government market
national, state, and local governmental offices and agencies
Institutions
nonprofit organizations that may be either public or private
Proprietorship
a business that is owned and often operated by a single individual
Doing business as (DBA)
license if using a name other than the owner's name (Fictitious name registration)
liability
legal responsibility
Partnership
an association of two or more persons who co-own a business with the objective of earning a profit
General partnership
co-owned by two or more general partners
Limited partnership
co-owned by at least one general partner and one or more limited partners
Partnership agreement
a written contract that establishes a partnership (also called articles of partnership)
Corporation
a business that is legally separate from its owners
articles of incorporation
must be filed to form a corporation
corporate bylaws
explain practices and procedures in a corporation
Stock
a share of ownership in a corporation
Dividend
portion of the corporation's earnings distributed to stockholders
Board of directors
a group of individuals who make high-level management decisions for the business and establish company policies
S corporation
provides limited liability to its owners, but is taxed as a partnership
Limited liability company (LLC)
combines the benefits of a corporation with those of proprietorships and partnerships; and profits are taxed to unlimited number of owners
Cooperative (co-op)
owned and operated by those using its services and requires full participation of members to operate
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