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

What is Net Worth and Why is it Important for Businesses?

Net worth represents the difference between a person's or corporation's assets and liabilities. It serves as a crucial indicator of a company's financial health, offering a snapshot of its current financial standing.

Understanding Your Net Worth

Knowing your net worth is essential as it helps identify areas of excessive spending. The ability to afford something doesn't necessitate its purchase. To prevent unnecessary debt accumulation, differentiate between needs and wants before making purchases.

Exploring the SEIS Program

The Seed Enterprise Investment Scheme (SEIS) is a UK government program designed to assist startups in raising capital. It aims to stimulate economic growth by promoting... Continue reading "Understanding Net Worth and Its Importance for Businesses" »

inequality:the unfair situation in society when some people have more opportunities,money, etc. Than other people:

global village:The term global village represents the simplifying of the whole world into one village through the use of electronic media.

MEDC:A developed country (MEDC) is a rich country.

LEDC:A developing country (LEDC) is a poor country.

fair trade:comercio justo(trade between companies in developed countries and producers in developing countries in which fair prices are paid to the producers.)

conflict-mineral:(Especially in Africa) A mineral mined in an area of armed conflict and traded illicitly to finance the fighting.

economic development:Economic development is the process by which a nation improves the economic, political,

Dual Income Tax System

This system levies a proportional tax rate on all net income (capital, wage, and pension income less deductions) combined with progressive tax rates on gross labor and pension income.

Implemented in Denmark, Finland, Norway, and Sweden, the dual income tax (DIT) system was introduced for reasons of economic efficiency, net-wealth tax, and a broader tax base.

Key features:

• Capital incomes are taxed at a lower rate.
• Acts as a hybrid model between income and consumption concepts (interest-adjusted income tax).
• All income and profit are divided into capital income (proportional/flat rate) and labor income (progressive rate).
• Features the lowest personal income tax (PIT) percentage on labor income.

Dividend Taxation

Corporate tax systems... Continue reading "Dual Income Tax & Dividend Taxation: A Comprehensive Guide" »

Economics

Definition

Derived from the Greek word ‘oikonomos,’ meaning “one who manages a household,” economics studies how societies allocate scarce resources to satisfy unlimited wants and needs.

Core Principles

1. Trade-offs: Acquiring something necessitates forgoing something else (e.g., watching TV versus studying).
2. Opportunity Cost: The cost of something is the value of the next best alternative forgone.
3. Marginal Thinking: Rational individuals make decisions by comparing the additional benefits and costs of an action.
4. Incentives: People's behavior is influenced by incentives, such as price changes (e.g., lower prices may increase consumption).
5. Benefits of Trade: Specialization and trade allow individuals and nations to achieve higher levels

International Marketing

Key Concepts

Market Potential

The total number of units of a product that could be sold by all companies in a specific international market.

Sales Potential

The percentage of market potential a specific company expects to sell in a specific international market.

Market Types

Industrial Market

Companies purchasing equipment and machinery.

Consumer Market

Represents over 50% of GDP in developed countries.

Government Market

Similar to industrial markets, but focused on major projects.

Marketing Strategies

Marketing Research

Collects information at a specific time to aid marketers' decisions.

Standardization

Using the same marketing strategies internationally as domestically.

Adaptation

Using different marketing strategies internationally... Continue reading "International Marketing and Production Strategies" »

Neoclassical Theory of Migration

This theory incorporates both macro and micro perspectives. It is fundamentally based on principles such as rational choice, maximizing advantages, income differentials, and net benefits.

Macro-Level Perspective

At the macro level, migrations occur due to differences in the supply and demand of labor across various locations, directly associated with wage disparities. Workers tend to move to places where salaries are higher.

Micro-Level Perspective

At the micro level, the neoclassical theory posits that individuals migrate after rationally considering the costs and benefits of the move. Therefore, it is the differentials in expected incomes and benefits—rather than merely salary differences—that motivate people... Continue reading "Understanding International Migration Theories" »

Understanding Commerce

General Characteristics

Commerce includes all economic activities intended to connect producers and consumers through the buying and selling of goods and services.

Some characteristic features of commerce today include:

• It is governed by the principles of supply and demand.
• In terms of location, it is physically concentrated primarily in urban environments. It is also closely related to and dependent on transport and communications networks.
• Countries are becoming increasingly interdependent. Multinational companies are also increasingly important in international trade.
• In developed economies, the growth of commerce is based on consumption by consumers, inhabitants, and companies, and the significant production of goods and

Nike and Corporate Social Responsibility

Nike came under fire from critics who alleged: corporate social responsibility.

Nokia's Reversal of Fortune

Nokia's reversal of fortune at the hands of Apple and Google TRUE

IKEA's CSR Initiatives

One of the Corporate Social Responsibility (CSR) initiatives by IKEA's primary carpet T

Forces Restraining Global Business

One of the forces restraining the growth of global business. TRUE

Potential Drawbacks of Regional Cost

One of the potential drawbacks of a regional cost can be prohibitive.

Global Success and Competencies

Organizations in order to be globally successful must be competencies.

Primary and Secondary Stakeholders

Primary stakeholders include all of the following except: media.

Secondary shareholders include... Continue reading "Global Business and Corporate Social Responsibility" »

Compensation

Rewards earned by employees in return for their labor

Direct Financial Compensation

Consisting of pay received in the form of wages, salaries, bonuses, and commissions provided at regular and consistent intervals

Indirect Financial Compensation

Including all financial rewards that are not included in direct compensation and understood to form part of the social contract between the employer and employee such as benefits, leaves, retirement plans, education, and employee services

Equity Theory

States that a person’s motivation is in proportion to the perceived fairness of the rewards he or she receives for the amount of effort he or she exerts, and that this is also compared with what others receive. According to the theory, individuals