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

Essential Accounting Terms and Principles

Basic Accounting Concepts

Accounting: The information system that identifies, records, and communicates the economic events of an organization to interested users.

Assets: Resources a business owns.

Auditing: The examination of financial statements by a certified public accountant in order to express an opinion as to the fairness of presentation.

Balance Sheet: A financial statement that reports the assets, liabilities, and owner's equity at a specific date.

Bookkeeping: A part of the accounting process that involves only the recording of economic events.

International Accounting Standards

Convergence: The process of reducing the differences between U.S. GAAP and IFRS.

Business Structures

Corporation: A business... Continue reading "Essential Accounting Terms and Principles: A Comprehensive Glossary" »

Athletes and Drug Use

Athletes caught using drugs should never be allowed to compete again. Do you agree?

Success, idolatry, age, poor social life, demand, high competition, are some of the reasons why athletes find an inappropriate refuge in drugs. Athletes who go down in history for their achievements and not for their scandals, one day they must decide which way to go. If for the success, a path that requires dedication to sun and shade and social abstinence, that is, to become an adult with adolescent mentality, where parties, excesses, drugs and alcohol have no place. Or the other, that of normal life along the normal path, which many 'athletes' choose because they are not willing to leave their social life in exchange for achieving glory... Continue reading "Exploring the Pros and Cons of Athletes and Online Shopping" »

Marketing

Marketing is the activities of a company associated with the purchase and sale of a product or service. In addition, marketing is a set of techniques and studies aimed at improving the marketing of a product.

Marketing includes:

• advertising
• the study of market behavior
• business management
• Consumer needs
• Selling and delivering products to people.

What is not marketing?

• Advertising (it is a marketing tool)
• Sales (it is one of the objectives of marketing)
• Promotions (it is a marketing tool)

What is marketing divided into?

The first function of marketing is to search, identify and analyze business opportunities that may exist in the market.

The second function of marketing is to select markets. A company invests large amounts of time and capital to... Continue reading "Understanding Marketing: Techniques, Functions, and 4 Ps" »

National Competitive Advantage

This is a national perspective!

Factor Endowments

The nation’s position in factors of production, such as skilled labor or infrastructure, necessary to compete in a given industry. Must be industry and firm specific. Firm-specific knowledge and skills that are rare, valuable, difficult to imitate, and rapidly and efficiently deployed ultimately lead to a nation’s competitive advantage. Examples: Japan's JIT inventory management, low-cost and sufficiently high-quality software development in India.

Demand Conditions

Home countries with demanding consumers drive firms to meet high standards, upgrade existing products and services, and drive for further innovation. The home countries’ consumers influence, push,... Continue reading "National Competitive Advantage: Factors and Strategies" »

Marketing Orientation - An outward looking approach basing product decisions on consumer demands as established by market research. The business attempts to produce what consumers want, this requires market research and market analysis to indicate consumers demand.

Benefits - Newly developed products failing are reduced. Consumers' needs are being met with appropriate products.Product Orientation - An inward looking approach that focuses on making products that can be made or have been made for a long time and trying to sell it. Invent products with the belief that they will find consumers to purchase them.Commercial Marketing - Satisfying consumers' needs for profit.

Chapter 1: Economic Foundations and Models

I. What is Economics?

Economics is the study of how people and societies choose to allocate scarce resources. It explores how individuals, businesses, and governments make decisions in the face of limited resources and unlimited wants.

Resources:

• Inputs, factors of production
• Goods or services used to produce other goods or resources

Primary Factors of Production:

• Labor (mental, physical)
• Capital (tools, equipment, structures)
• Land (natural resources like water, oil)

Scarcity:

• The fundamental economic problem: resources are limited.
• We face constraints in our choices.
• Economics seeks to determine the best allocation of scarce resources.
• The goal is to maximize utility (satisfaction) in the face of scarcity.
• Without

1. BUSINESS AND THE NEW TECHNOLOGIES (TECHNOLOGICAL GROWTH)

Introduction

This study analyzes new technologies, their origins, and their development, exploring the rise of technology and its relationship with businesses and society.

Origin of New Technologies

The technological bubble of the 1990s, marked by the birth of the internet and the end of the Cold War, sparked the development of new technologies. This period led to globalization, with economies striving for technological and economic advancement. High-end computers with operating systems like Windows NT (1990), 95, 98, XP, or IOS emerged, streamlining administrative processes and business operations.

Effects of the New Technologies

The effects of new technologies are evident in both society... Continue reading "The Impact of New Technologies on Business and Society" »

The National Commission of Securities Market

The National Commission of Securities Market is an institution under the Ministry of Economy and Competitiveness of Spain. The basic function of the CNMV is to monitor the functioning of securities markets in Spain, which include:

1. Ensuring transparency of the Spanish market
2. Ensuring the correct formation of prices of the financial instruments
3. Protecting investors

Prudential Supervision

The CNMV exercises prudential supervision over the following entities in order to ensure transaction security and the solvency of the system:

• Collective Investment Schemes (instituciones de inversión colectiva), a category which includes: investment companies (securities and real estate), investment funds (securities and

Perf Elasticity

(Edp=8) when a minute change in price brings infinite change in Qd, demand is considered to perf elastic. Coefficient of elasticity of demand is equal to infinity here. Parallel to X-axis

Highly Elastic Demand

when a small percentage change in price results in high % change in Qd is highly elastic in nature, coefficient of elasticity in demand is greater than one.

Perf Inelastic Demand

when a big % change in price in price fails to bring any change in Qd the demand id perf inelastic. equal to 0.

Law Of Supply

other than things remaining the same, when price of a commodity increases its quantity supply also increases, and when price of commodity decreases its quantity supply also decreases.

Market Equilibrium

it is a state of balance... Continue reading "Understanding Economic Concepts and Theories" »

Business Entities and Tax Implications

Taxation of Partnerships

Partnerships are not taxed at the corporate level. Instead, taxes are levied on the individual partners based on their share of the partnership's income.

Taxation of Corporate Entities

Corporations have a separate legal personality and are subject to corporate income tax. Shareholders are also taxed on the dividends they receive.

Justification for Corporate Income Tax

• Avoid tax deferral
• Neutrality
• Incentivize investment

Tax calculation: Tax = Tax Base x Tax Rate

Corporate and Shareholder Tax Systems

Classical System

Corporate profits are taxed at the corporate level, and dividends are taxed again at the shareholder level, resulting in economic double taxation.

Full Integration System

Corporations... Continue reading "Understanding Corporate Taxation: Systems, Distributions, and Debt-Equity Considerations" »