Economics

See Investopedia or the Economist for more definitions.

Scarcity - When something is both desired and limited in supply.

Factors of Production (human resources, natural resources, capital resources, entrepreneurship) - The inputs that are used in the production of goods or services.

Goods and Services - A good is a tangible product; where as a service is an intangible product and used for support.

Wants and Needs - Someone would die without their needs being met. People need food, water, and shelter. A want is something that people prefer or desire.

Opportunity Costs and Trade-offs - Every choice involves tradeoffs, and opportunity cost shows you how to measure these tradeoffs. It is the value of the next best alternative.

Production Possibilities Curve - A curve on a graph which shows different combinations of two goods that an economy can produce using certain resources during a specified time.

Three (3) Basic Economic Questions and how different economic systems will answer them. 1) What outputs will be produced? 2) How will the outputs be produced? 3) Who will the outputs be produced for?

Traditional, Command, Market, and Mixed Economic Systems - The method in which the government influences or ignores economics.

Circular Flow - An economic model which shows how resources, money, credit, and goods and services flow within a society.

Voluntary Exchange - The process where customers and merchants freely and without coercion engage in market transactions (Neoclassical or mainstream economics).

Law of Supply - As the price of a good or service increases, the quantity of goods or services that suppliers offer will increase, and vice versa.

Law of Demand - The quantity purchased will vary with price. The higher the price, the lower the quantity demanded. The law of demand states there is an inverse relationship between quantity purchased and price.

Incentives - Social norms with financial rewards and punishments

Competition - The four types of competition we discuss in this class are Perfect Competition with Infinite Buyers and Sellers, Monopoly with One Producer, Oligopoly with a Handful of Producers, Monopolistic Competition with Numerous Competitors with unique brands, which are not easily substitutable.

Private Property Rights - The theoretical and legal ownership of resources and how they can be used. These resources can be both tangible or intangible and can be owned by individuals, businesses, and governments.

Equilibrium - A condition or state in which economic forces are balanced. One example is where the supply and the demand curve meet is known as equilibrium or market equilibrium.

Market Clearing Price - The equilibrium monetary value of a traded security, asset, or good. This price is determined by the interaction of supply and demand forces.

Marginal Cost - A measurement used to determine the additional cost incurred in the production of one more unit of a good or service.

Entrepreneurship | Marketing

• 90-Second Pitch

• Customer Acquisition Cost

• Life-time Value of the Customer

• Entrepreneur (innovator, one who takes risk in hopes of rewards)

• Risk (chance of loss or failure)

• Franchise (ownership type, proven business plan)

• SBA (U.S. Small Business Administration)

• Lean Canvas Model (business plan summary to fail fast)

• Brainstorming (ideal generation, ideation)

• Green entrepreneurship (environmentally driven)

• Market segmentation (Target Customer)

• Pivoting (Adjust, Evolve)

• Minimum viable product (MVP)

• Unique value proposition (UVP)

• Supply (goods or services produced/offered)

• Opportunity cost (cost of next best alternative)

• Import (production of goods are outsourced to another country)

• Marketing mix (resources deployed to persuade people to do something)

• Brick-and-mortar stores (physical location)

• Online stores (e-commerce, virtual point-of-transaction)

• Market share (share of mind, heart, wallet, percentage of total market)

• Promotional mix (blend of advertising or promotional tools used)

• Online presence (virtual presence on the Internet)

• Digital analytics (key performance indicators or KPIs, metrics)

• Start-up costs (cost associated with starting a business)

• Variable costs (quantity x cost per unit)

• Fixed costs (Contract, Scheduled, Regular)

• Break-even point (Total Cost = Total Revenue)

  • Quantity = fixed costs / (sales price per unit – variable cost per unit)

• Crowd funding (Sourcing)

• Bootstrapping (Minimal)

• Equity financing (Ownership)

• Pitching (Proposing)

• Point of Sale (POS)

• Income statement/Profit & Loss statement

  • Net Income = (Total Revenue + Gains) – (Total Expenses + Losses)

• Balance sheet (Statement of Financial Position)

  • Assets = Liabilities + Owners Equity (OE)

• Mission statement (Purpose)

• Job descriptions (Roles and Responsibilities)

• Sole proprietorship (One)

• Partnership (Two+)

• Corporation (Equity)

• Nonprofit (Cause)

• Business taxes (20%)

• Copyright (Original)

• Patent (Utility)

• Trademark (Brand)

• Business insurance (Liability)