Notes, summaries, assignments, exams, and problems for Economics

The seven principles stated on the article are:

1.)Price stability provides substantial benefits

Low and stable inflation prevents overinvestment in the financial sector which otherwise would be a way to escape the costs of inflation. It lowers uncertainty enabling businesses and individuals to make appropriate decisions, increasing economic efficiency and finally lowers distortions from interactions between the tax systems and inflation (Better employment of resources and increase economic growth).

2) Fiscal policy should be aligned with monetary policy;

Large government deficits place pressure on monetary authorities to monetize debt, producing rapid money growth and inflation.

3) Time inconsistency is a serious problem to be avoided;

Motivation...

Telemarketing

It is a marketing action in which the telephone is used as the communication channel. It is aimed at contacting clients for commercial purposes, sales, or improving corporate image. It is part of a sales strategy of a company

Applications

1. Commercial applications: the goal here is to make a sale. How?

• Locating potential customers

• Arranging interviews for the sales team

• Keeping track of previous contacts

• Teleshopping

• Generating new sales of a product or a related one to the same customer (cross-selling)

• Renewing subscriptions (magazines, etc)

• Communicating new offers

• Attracting new customers

• Reactivating “silent” customers

• Follow-up, keep track of commercial offers received through postal mail or e-mail

2. Marketing applications, to gather information

Stakeholders in Business

Owners and Stockholders

• Have a monetary or nonmonetary interest in an organization or entity.
• Look for high profit, dividend, and long-term growth, as well as a positive corporate image.
• Example: Mr. XYZ is an owner of company ABC and expects a financial return.

Suppliers

• Companies build a number of small, loyal relationships with suppliers and associates.
• This enables each business to develop shared goals, visions, and strategies.
• Trade buyers and sellers can effectively collaborate to deliver the best value to end customers, which is beneficial to each side.
• Example: Carrefour Market is a distributor and supplier for Nestle products. Lulu aims for satisfactory transactions and revenue from purchases.

Employees

• Expect fair working

Developing Export Strategy

Companies develop this strategy when customers in other countries request their goods.

Step 1: Identify a Potential Market

A company should conduct market research and analyze the results. Example: ART BRZ

Step 2: Match Needs to Abilities

Determine whether the company can meet the needs of the market. Example: Air conditioning

Step 3: Initiate Meetings

Build trust and develop a cooperative environment among all parties. Example: Arizona Companies

Step 4: Commit Resources

Allocate the company's human, financial, and physical resources to the project.

Export/Import Financing

1. Open Account

Export/Import financing where an exporter ships merchandise and later bills the importer for its value. Example: MGT briefcase

2. Advance Payment

Export/...

Which of the following is a flow variable? income

Which of the following is a component of money?

Which of the following is a component of money?

Fixed Costs

Fixed costs are the costs of production that a business has to pay regardless of how much it produces or sells. Fixed costs exist even if there is no output. These costs remain unchanged in the short run. They can change, but these changes happen independently from the level of output.

Scale of Operations

Scale of operations is the maximum output that can be achieved using the available resources. It can be increased in the long term.

Variable Costs

Variable costs are the costs of production that change in direct proportion to the level of output or sales. These include commission earned by staff, raw materials, packaging costs, etc. In theory, if there is no production, then variable costs equal zero.

Contribution

Contribution refers...

Fundamental Accounting Principles

Accrual Basis of Accounting

Revenue is recognized when earned, and expenses are recognized when incurred, regardless of when cash changes hands.

Cash Basis of Accounting

Revenue is recognized when cash is received, and expenses are recognized when cash is paid.

Matching Principle

Requires expenses to be recognized in the same period as the revenues they helped generate.

Time Period Principle

States that a business should report its financial results over specific, consistent time periods.

Key Financial Statement Components

Current Assets

Assets expected to be converted to cash, sold, or consumed within one year or one operating cycle, whichever is longer.

Long-Term Investments

Investments held for more than one year, typically...

Characteristics of a Financial Plan

• It's a roadmap that can be used to guide a company into the future.
• Can be used to attract investors.
• Explains how a business will manage its records and why.
• Describes any legal agreements that influence the way records are kept.

Six Things an Effective Plan Contemplates

• Identifies the assets that need to be purchased.
• Describes the amount of money a business needs to start and operate.
• Describes the expenses the business will incur and explains how a business will cover its expenses.
• Describes how a business will document and report financial reports.
• Forecasts finances to project future profitability.
• Explains how the business will acquire money to grow or expand.

Startup Capital

Startup capital is the money used to...

UNIT 1

1. What are the two perspectives of marketing?

Philosophy and Technique.

2. Who first mentioned the concept of marketing-mix?

Neil Borden.

3. What is the current concept of marketing?

The current concept arises from the customer's or user's needs which guide production.

4. Do all companies are marketing oriented?

No, companies can be Sales or Marketing oriented.

5. What is the difference between the four 'p' and the 'four c's?

From a customer's point of view, the 4 P's of marketing become the 4 C's.

6. What decisions include sales management?

• Strategic decision
• Selection training
• Motivation
• Supervision and compensation of sales team.

7. What is relationship marketing?

Relationship marketing is the establishing of long-term, stable relationship with a...

Balanced Budget

Balanced budget is when current revenues equal current expenditures; however, when a deficit budget occurs causing revenues to fall short of expenditures, it requires the government to borrow money or even tap into reserves to make up the difference. This becomes a requirement that shapes the entire budget process, thus making budget deliberations revenue-driven when revenues determine the level of spending. Balanced budget is elusive when authorities propose a balanced budget but the council approves an unbalanced one or state or local laws allow the deficit at the end of the year to be carried over to the next year. Furthermore, there are no consistent or enforced standards for the balanced budget since it may be manipulated...