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Exercise 4

1. Business is defined as an occupation that people do to earn money through selling, exchanging or receiving money for goods and services. 2. For-profit organizations aim to maximize profits for owners/shareholders, while non-profits provide for societal needs without owners and are more concerned with guaranteeing revenues exceed costs to continue operating. Examples of each are provided. 3. Production is the process of combining material and knowledge-based inputs to create goods or services for consumption, with the theory of production focusing on this area of economics.

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438 views2 pages

Exercise 4

1. Business is defined as an occupation that people do to earn money through selling, exchanging or receiving money for goods and services. 2. For-profit organizations aim to maximize profits for owners/shareholders, while non-profits provide for societal needs without owners and are more concerned with guaranteeing revenues exceed costs to continue operating. Examples of each are provided. 3. Production is the process of combining material and knowledge-based inputs to create goods or services for consumption, with the theory of production focusing on this area of economics.

Uploaded by

Diego Fuller
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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EXERCISE 4.

DISCUSS THE FOLLOWING QUESTIONS:

1. Give definition to the word ‘business’.


business is the occupation that people do to get something in return for
example sell, exchange or receive money in return

2. What is the difference between for-profit and non-profit


organizations? Support your answer with relevant examples.
There are several differences between organizations with fines and
non-profits. While the goal of the former is to maximize profits and
forward these benefits to the owners and shareholders of the company,
nonprofit organizations aim to provide the needs of society.
Nonprofits have no owners. Instead of maximizing profits, which means
maximizing revenues and minimizing costs, they are more concerned
with guaranteeing revenues greater than costs. This ensures that the
non-profit organization can still provide the needs of society.
Examples of lucrative organizations
Nestlé, Apple.
Examples of non-profit organizations
Religious Centers, Sport clubs

3. What is production?
Production is a process of combining several material inputs and
intangible inputs (plans, know-how) to do something for consumption
(output). It is the act of creating a product, a good or service that has
value and contributes to the usefulness of individuals. The area of
economics that focuses on production is known as the theory of
production, which in many ways is similar to the theory of consumption
(or consumer) in economics.

4. Specify the notion of ‘just-in-time inventory’.


Definition: Just-in-time inventory (JIT) is a management strategy that
aims to increase a firm’s operating efficiency and decrease the level of
waste by only keeping enough stock on hand to fulfill current orders or
maintain production. With a JIT inventory system, the firm purchases
only the level of inventory that it uses in the production process.

5. What is marketing?
Marketing is defined by the American Marketing Association as:
"the activity, set of institutions, and processes for creating,
communicating, delivering, and exchanging offerings that have value
for customers, clients, partners, and society at large.“

6. Define such business operation as finance.


Business finance is the money you need to establish and run your
business, which includes modernizing or diversifying operations and
expansion. Everything that happens within a company to keep it
running and earning money is referred to collectively as business
operations. Business plans often include a section dedicated to
operations so that company founders understand the systems,
equipment, people, and processes need to make the organization
function.

7. What does the HRM involve?


Human resource management (HRM), or human resource
development, entails planning, implementing, and managing
recruitment, as well as selection, training, career, and organizational
development initiatives within an organization. The goal of HRM is to
maximize the productivity of an organization by optimizing the
effectiveness of its employees while simultaneously improving the work
life of employees and treating employees as valuable resources.
Consequently, HRM encompasses efforts to promote personal
development, employee satisfaction, and compliance with
employment-related laws.

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