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key terms
| Term | Definition |
|---|---|
| Avoidance | a risk-response strategy that involves choosing not to do something that is considered risky |
| Business risk | the possibility of loss ( failure) or gain ( success) inherent in conducting business |
| Competition | the rivalry between two or more businesses to attract scarce customer dollars |
| Cost of goods | the amount of money a business pays for the products it sells or for the raw materials from which it produces goods to sell; the amount of money a business pays for the products ( or for any part of the products) it sells |
| Direct Competition | rivalry between or among businesses that offer similar types of goods or services |
| Economic risk | the possibility of loss or failure that occurs as a result of the economy |
| Expenses | the money that a business spends |
| Gross profit | money left after the cost-of-goods expense is subtracted from total income |
| Human Risks | the possibility of loss or failure from human error |
| Income | the money received by resource owners & by producers for supplying goods & services to customers |
| Indirect Competition | rivalry between or among businesses that offer dissimilar goods or services |
| Market Structure | the type of marker, or environment, in which businesses operate |
| Monopoly | a type of market structure in which a market is controlled by one supplier, there are no substitute goods or services readily available |
| Natural Risk | the possibility of loss or failure from nature |
| Net profit | money left after the cost-of-goods expenses and the operating expense are each subtracted from the total income |
| Nonprice competition | a type of rivalry between or among businesses that involves factors other than price |
| Oligopoly | a market structure in which there relatively few sellers, & industry leaders usually determine price |
| operating expenses | all of the expenses involved in running a business |
| perfect competition | a market structure in which there are many businesses selling a lot of identical products for about the same price to many buyers; also known as pure competition |
| price competition | a type of rivalry between or among businesses that focuses on the use of price to attract scarce customer dollars |
| profit | monetary reward a business owner receives for taking the risk involved in investing in a business; income left once all expenses are paid |
| profit motive | the desire to make a profit, which moves people to invest in business |
Created by:
destiny.s904
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