Business 101 Exam

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Bus 101 Final Exam

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4 levels- Ownership, Legal Right, Moral Right, Interest (no legitimacy)
Ability to influence the decision (money, public opinion, political power, etc)
Want to influence the decision.
4 business processes
Acquiring customers, acquiring financial capital, managing human resources, creating value.
Acquiring customers
product (customer), price (cost), promotion (communication), Place (convenience)
Acquiring financial capital
Debt, equity, financial impact (cost and risk)
managing human resources
hiring/firing, retaining the best employees.
Creating value
raw material from suppliers,
Sarbanes-Oxley Act
protect owners/investors
Critical Thinking Skills
(0)confused fact finder, (1) biased jumper, (2) perpetual analyzer, (3) pragmatic performer, (4) strategic revisioner
confused fact finder
looks for the only answer, doesn't seem to get it, quotes inappropriately, illogical/contradictory arguments, appears unable to read carefully, insists professors, textbooks, or other experts provide the correct answer even to open ended problems. 50% of first year college students.
biased jumper
jumps to conclusions, doesn't recognize own biases, accuses others of being bias, stacks up evidence for own position and ignores contradicting evidence, uses unsupported personal opinion as evidence, acknowledges multiple viewpoints but cannot adequately address a problem from viewpoint other than own.
perpetual analyzer
doesn't reach or adequately defend a solution, exhibits strong analysis skills, but appears to be wishy-washy, writes papers that are long and seem to ramble, doesnt stop analyzing, "wait what about this", "I can also look at it this way and.."
pragmatic performer
considers alternatives before reaching conclusions, incorporates others in the decision process, views tasks as finished when a solution is reached.
Strategic re-visioner 
seeks continuous improvement, lifelong learning, anticipates change, thinks outside the box, works toward constructing knowledge over time.
sales, the top line, what customers pay
net income, the bottom line, what owners receive after subtracting all business cost.
81st question
functions of an HR manager
strategic, associate advocate, administrative
20%=>60%, at the MGT table--collaborative, planning, measurement
associate advocate
30%=>30%, hr development, employee and labor relations, compensation and benefits, health safety and security, staffing. 
50%=>10%, government reporting, payroll, osha reporting, legal complianace
employment at will doctrine (common law)
you can start and stop working someplace anytime for no reason
HR statutory laws
civil rights act, age discrimination act, equal employment opportunity act (affirmative action), americans with disabilities act
"at will" exceptions
public policy-protects employees from being fired for refusal to commit crimescontractual actions- protects employees who they believe have contracts or implied contractsbreach of good faith actions- employers are expected to hold to a standard of fairness and good faith dealings
Model Employee Termination Act (META)
requires employers to at least show "good cause" for terminating you in states that have adopted it. 
sources of employee rights
statutory rights (government laws), collective bargaining rights (union contracts), enterprise rights (promises from the business)
alternative dispute resolution
hearing procedure-permits employees to be represented by an attorney or neutral partyombusman-a troubleshooter investigates and helps achieve equitable settlements for employee complaintspeer review panel- fellow workers in the same job family and at a grade level equal to or higher than the employee with a grievance
size of the U.S. GDP
$14 trillion
U.S market
300,000,000 (300 million)
world market
7,000,000,000 (7 billion)
how much profit do companies
sole proprietorship advantages
easy to start, simple tax rules (business income=personal income)
sole proprietorship disadvantages
unlimited liability, limited resources available, limited growth potential. 
partnerships advantages
more resources available, can share the load, longer survival, no special taxes
partnerships disadvantages
unlimited liability in some forms of partnerships, division of profit, potential for disagreements, exit conditions must be spelled out in partnership agreement. 
general partnership
each general partner manages the firm, each has unlimited liability.
limited partnership
at least one general partner with unlimited liability, rest are passive investors with limited liability
corporation advantages
limited liability, greater acces to $, separation of ownership from management, ease of ownership transfer
corporation disadvantages
more costly to form, must keep accurate records, potential for conflicts with BOD, taxed twice if dividends given, separation of ownership from management
Milton Friedman
strategic, owner profit
Edward Freeman
multi fiduciary, look out for all stakeholders
Blanchard & Peale's ethical check questions
Is it legal? Does it seem fair? How will it make me feel about myself?
equity finance, stockholders, shareholders, investors
not appointed by board, receive health benefits
B2B & B2C, always look from the perspective of company
raw material inputs and debt capital. No health benefits
environmental concerns, potential employees
income statement
cash statement
cash from operations +/- investments +/- financing
balance sheet
assets=liabilities+equitywhat you own=owed others +owed to yourself
contract law requirements
voluntary offer and acceptance, legal, competency, consideration
fiduciary must follow these obligations
loyalty, obedience, notification, accounting, reasonable care
principal has obligations
indemnification, reimbursement 
issuing shares of ownership
borrowing money
who gets paid back first... and then
secured debt, unsecured debt, preferred stock, common stock.
positives of debt
tax deductibility of interest, debt does not dilute control of the firm, lower cost of funds
disadvantages of debt
increases probability of financial distress, uses up potential debt capacity
problems with agency relationship
excessive perks, shirking, agents act in own best interest.
creating value decisions
how many factories, how much capacity at each, low cost or customizable products, what will we make and what will we buy from others, how will we measure quality, how much inventory, skilled or unskilled