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

Strategy Identification and Selection

Strategy identification and selection involves defining the approaches a company will take across various dimensions:

1. Product Market Investment Strategies: (See the Ansoff Matrix)
2. Investment Strategies: Defined by the strategic approach in economic and financial terms (e.g., reducing costs, promotions, price reduction, quality increases).
3. Functional Area Strategies: The development of a business strategy involves specifying strategies for functional areas such as sales, brand management, R&P, manufacturing, supply chain, and finance. It is critical that the various departments are coordinated so they do not work at cross-purposes, as objective alignment can be difficult.

   The role of strategic objectives

Types of Cooperatives

1. Financial Cooperative: A financial institution where ethical and social aims take precedence over profit. Example: Lending money at lower interest rates, or providing loans to individuals who might not qualify at traditional institutions.

2. Housing Cooperative: Run to provide housing for its members, as opposed to generating rent for private landlords. Example: Owning an apartment building where each member is entitled to one housing unit.

3. Workers' Cooperative: A business owned and operated by the workers themselves, typically avoiding significantly higher wages for managers. Their primary priority is providing employment. These cooperatives often emerge when a business is about to fail, and workers take over to save their

Accounting Fundamentals: True or False Statements

1. The usual presentation of the retained earnings statement includes (1) Beginning balance, (2) Net income or loss, (3) Dividends, (4) Stockholders' contributions, and (5) Ending balance.

   Answer: False

2. Office Equipment is an example of a current asset account.

   Answer: False

3. Journalizing and posting closing entries must be completed before financial statements can be prepared.

   Answer: False

4. Assets, liabilities, and stockholders' equity accounts are real accounts and do not get closed at the end of the period.

   Answer: True

5. In a merchandising business, sales minus operating expenses equals net income.

   Answer: False (Sales minus Cost of Goods Sold equals Gross Profit; Gross Profit minus Operating Expenses equals

The Welfare State: A Social Contract

The welfare state is a system in which the government provides citizens with a minimum level of education, healthcare, and financial support, even during challenging circumstances such as illness, retirement, disability, or unemployment.

Types of Taxes

Value-Added Tax (VAT)

A tax levied on the price of goods or services paid by consumers.

Income Tax

A tax on the income earned by individuals or businesses, including salaries and profits.

Company Tax

A tax on the profits generated by companies.

Social Security Contributions

Taxes paid by both employers and employees to fund social security programs.

Measuring Social Inequality: The Gini Coefficient

The Gini coefficient is a measure of social inequality, ranging from 0... Continue reading "Understanding the Welfare State and Social Security: A Comprehensive Guide" »

SMART Objectives

SMART objectives: Specific, Measurable, Achievable, Relevant, Time-bound

Aims vs. Objectives

Difference between aims and objectives: Aims are general statements concerning the overall goals, ends, or intentions of teaching. Objectives are the individual stages that learners must achieve to reach these goals.

AIDA

AIDA: Attention, Interest, Desire, Action. The objective is close to the sale.

Marketing Mix

Marketing mix: 4 aspects to be considered in the market: product, price, distribution, and promotion.

KPIs

KPIs: Numbers related to the objectives set within our strategy or annual marketing plan.

The Boston Matrix

The Boston Matrix: Relationship with the commission and the growth of the market.

The Body Shop (Auditing)

How do the auditing

• Modes of International Business

  • Merchandise Exports & Imports

-This is the most common mode of international business.

-Merchandise exports and imports are tangible products. They can be seen leaving and entering a country.

• • Services Exports & Imports

They are international non-product sales and purchases.

• • • Tourism and Transportation:

Are important sources of revenue for airlines, shipping companies, travel agencies, and hotels.

• • • Performance of Services

This refers to company's earnings in the form of fees (payments for the performance of a service).

1. Turnkey Operation

Is a deal where a company takes all responsibility for constructing, fitting and staffing a building (such as a school, hospital or factory) so that it is completely ready for the purchaser... Continue reading "Modes of International Business and Investment" »

What is Economics?

Economics is the study of choices that people make to satisfy their needs and wants.

Factors of Production

• Land
• Labor
• Capital
• Entrepreneurship

Goal of Entrepreneurship

The goal of entrepreneurship is to be successful and maximize profit.

Why is Scarcity a Basic Problem of Economics?

Scarcity is a basic problem because wants are unlimited, even when resources are limited. Therefore, it's crucial to use resources effectively.

What Issues Must Producers Address to Distribute/Allocate Resources?

1. What to produce?
2. How to produce?
3. For whom to produce?

Why Do Producers Study Productivity?

Producers study productivity to determine if resources are being used wisely.

Why is Sacrifice an Important Element of Economic Choice?

Sacrifice forces people to... Continue reading "Understanding Economics: Principles and Applications" »

Business Ethics and Corruption in Spain

Introduction

This study analyzes business corruption in Spain, focusing on its origins and development. This report highlights two key dimensions: the causes and the effects of business corruption within the country.

Causes of Business Corruption

The primary cause of business corruption stemmed from exploiting the pre-crisis situation. The price of housing was well above its real value, a direct consequence of the inmobiliaria bubble. Furthermore, banks were granting high-risk mortgages without sufficient endorsement, famously known as subprime mortgages. While the risk of non-payment for these loans was exceptionally high, the profitability banks obtained was equally significant.

Another ethically incorrect... Continue reading "Business Corruption in Spain: Causes and Consequences" »

Executive Summary

This policy paper analyzes Venezuela's recent financial crisis and provides recommendations to the Venezuelan government regarding exchange rate policy.

Venezuela's Economic Crisis

Venezuela has experienced a rapid economic downturn since the implementation of socialist economic policies in 1999. The country's heavy dependence on oil exports to manage the economy has stifled private investment and created an over-reliance on imports for basic goods. The drop in global oil prices since 2013 has plunged Venezuela into hyperinflation, which exceeded 1.3 million percent in 2018. The nation's political turmoil has been exacerbated by a lack of economic development, corruption, and the devaluation of its currency, the Venezuelan Bolivar.... Continue reading "Venezuela's Financial Crisis: Exchange Rate Solutions" »

Chapter 1: Introduction to Economics

Economics is the study of how we choose to use resources to produce goods and services. There are four factors of production:

• Land: Natural resources, such as grass
• Labor: Human effort, such as work
• Capital: Tools and machinery used in production
• Entrepreneurship: The ability to combine the other factors of production to create goods and services

When making economic decisions, we consider marginal benefit (MB) and marginal cost (MC). If:

• MB > MC: It is beneficial to proceed
• MB = MC: This is the break-even point
• MB < MC: It is not beneficial to proceed

Economic theory simplifies economic reality, while economic policy involves remedial actions taken to solve economic problems. Economic goals include economic... Continue reading "Fundamentals of Economic Theory and Practice" »