Business Key Terms and Summaries. High School Work.

Principles of Business.

Section 1 - The Nature of Business

An Enterprise is simply another word for a business.

Entrepreneurship- is the practice of identifying new innovation or opportunity, organizing the financing and other resources and taking the risk in the hope of creating wealth.

Barter- this is the practice of exchanging goods for other goods.

Profit- This is the money remaining after the cost of production, distribution and taxes have been paid.

Loss- This is when the costs of production and other expenses are greater than the revenue.

Trade- this is the buying and selling of goods.

Organization- this is a group of persons using resources or things that are arranged in a certain way to carry out certain activities to achieve a goal.

Economy- this is a system that allocates or shares up scarce resources by deciding what should be produced, how and for whom.

Producer- this is the person or business that makes goods or services.

Consumer- this is the person or group that buys goods or services to satisfy wants and needs.

Exchange-this is the giving of one thing and receiving of another.

Goods- these are the things that are made to be sold (products).

Services- this means work that is done for another.

Market- this is any situation where buyers and sellers meet or communicate to exchange goods and services.

Commodity-this is a good that is traded.

Capital- this means the money or resources used to start a business.

Labour- this is the physical or mental work of a person.

Specialization- this refers to the division of a task into a number of related parts.

Instruments of Exchange.

History- barter was one of the first means of exchange. The barter system had many limitations though, such as, when the double coincidence of wants does not occur, the rate of exchange does not match, the indivisibility of certain commodities and the store of wealth. Trading materials started from things as peas, stones and shells, to using precious metals...