The Business Environment
How do different economies work?
- Identify factors affecting a business's profit
Objectives
a. Define the following terms: profit, profit motive, income, expenses, cost of goods, operating
expenses, gross profit, and net profit.
b. Identify reasons that people are willing to invest in businesses.
c. Explain how profit is calculated.
d. Explain the importance of profit.
e. Describe factors that affect profit (i.e., the economy, demand, chance, expenses, pricing).
f. Explain ways that businesses can increase profit (i.e., decrease expenses, increase sales).
g. Defend businesses' need to make a profit.
a. Define the following terms: profit, profit motive, income, expenses, cost of goods, operating
expenses, gross profit, and net profit.
b. Identify reasons that people are willing to invest in businesses.
c. Explain how profit is calculated.
d. Explain the importance of profit.
e. Describe factors that affect profit (i.e., the economy, demand, chance, expenses, pricing).
f. Explain ways that businesses can increase profit (i.e., decrease expenses, increase sales).
g. Defend businesses' need to make a profit.
Resources
Profit
Just what is profit?
6 roles and importance of profit in business
What is profit motivation?
Importance of profit in a business.
Chapter V: Knowing the keys to business success.
What factors affect profitability?
GCSE business studies
Profit. [Video].
Profit
Just what is profit?
6 roles and importance of profit in business
What is profit motivation?
Importance of profit in a business.
Chapter V: Knowing the keys to business success.
What factors affect profitability?
GCSE business studies
Profit. [Video].
| week_16_brief.pdf |
Ethics Case - Jeremiah
Jeremiah strives to make a profit for his company because he knows that profits help the company to expand, generating more jobs, providing higher wages, and contributing to the economy. However, Jeremiah knows that his company doubled its profits last year, yet it hasn’t added any new jobs or given him (or any of his coworkers) a raise. Jeremiah believes that the company’s top executives must be pocketing all of the extra profits as bonuses or salary increases. They do not seem to be using the money to grow the business or give back to employees at all levels.
(Ethical Principles Involved: Integrity, Trust, Transparency, Fairness, Respect)
Jeremiah strives to make a profit for his company because he knows that profits help the company to expand, generating more jobs, providing higher wages, and contributing to the economy. However, Jeremiah knows that his company doubled its profits last year, yet it hasn’t added any new jobs or given him (or any of his coworkers) a raise. Jeremiah believes that the company’s top executives must be pocketing all of the extra profits as bonuses or salary increases. They do not seem to be using the money to grow the business or give back to employees at all levels.
- What should Jeremiah do?
- Is the company acting unethically?
- Should Jeremiah trust higher-level executives to make the right decisions regarding the company’s profits?
(Ethical Principles Involved: Integrity, Trust, Transparency, Fairness, Respect)
How do different economies work?
- Determine factors affecting business risk
Objectives
a. Define the following terms: business risk, economic risks, natural risks, human risks, pure risks, speculative risks, guarantees, and warranties.
b. Classify business risks.
c. List types of economic risks.
d. Identify examples of natural risks.
e. Identify examples of human risks.
f. Distinguish between pure and speculative risks.
g. Describe ways that businesses can prevent or control risks.
h. Describe ways that businesses can transfer risks.
i. Describe reasons that businesses retain risks.
j. Explain ways that businesses can avoid risks.
a. Define the following terms: business risk, economic risks, natural risks, human risks, pure risks, speculative risks, guarantees, and warranties.
b. Classify business risks.
c. List types of economic risks.
d. Identify examples of natural risks.
e. Identify examples of human risks.
f. Distinguish between pure and speculative risks.
g. Describe ways that businesses can prevent or control risks.
h. Describe ways that businesses can transfer risks.
i. Describe reasons that businesses retain risks.
j. Explain ways that businesses can avoid risks.
Resources
Profits come from taking business risks.
Identifying and managing business risks.
Pure vs. speculative risk.
Profits come from taking business risks.
Identifying and managing business risks.
Pure vs. speculative risk.
Videos
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Managing risk, speculative risk, and pure risk discussed.
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Factors affecting business risks.
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Ethics Case - Bridget
Bridget is excited about a new product idea that she is pitching to her company. She knows that there are risks involved with launching a new product, but she is so confident in her idea that she believes the business should retain the risk associated with the product. During her pitch, Bridget does not discuss any strategies to avoid, prevent, or transfer the risks associated with this product. In fact, she does not mention any risks at all!
(Ethical Principles Involved: Integrity, Accountability, Transparency, Viability)
Bridget is excited about a new product idea that she is pitching to her company. She knows that there are risks involved with launching a new product, but she is so confident in her idea that she believes the business should retain the risk associated with the product. During her pitch, Bridget does not discuss any strategies to avoid, prevent, or transfer the risks associated with this product. In fact, she does not mention any risks at all!
- Is Bridget’s decision to ignore risks ethical?
- Or is she endangering the wellbeing of her company because of her own inability to account for risk?
(Ethical Principles Involved: Integrity, Accountability, Transparency, Viability)
Activity - School Enterprise
Identify sources of income and expenses for a school-based enterprise and determine ways that the enterprise could increase its profit. Analyze a school-based enterprise to identify the risks encountered. List her/his findings, discuss them with the class, and recommend steps that could be taken to limit the enterprise’s chances of loss.
Identify sources of income and expenses for a school-based enterprise and determine ways that the enterprise could increase its profit. Analyze a school-based enterprise to identify the risks encountered. List her/his findings, discuss them with the class, and recommend steps that could be taken to limit the enterprise’s chances of loss.
- You may work alone or with one partner
- Create a presentation using Google Slides and upload to Google Classroom (20 points)
- Each person in the group will present for 1 minute (50 points)
- FBLA dress code, FBLA shirt, or Ugly Christmas Sweater (30 points)