Introduction to Business

NBEA

THE ROLE OF
BUSINESS IN
SOCIETY?
INTRODUCTION TO BUSINESS
Unit Learning Outcomes
I Can Discuss …
• the role of business in society
• the primary departments (functions) within a business
• external forces that affect business activities

____________________________________________________________________________

I Will Be Able To …
1.1: Explain the concept of business

1.2: Distinguish between for-profit and nonprofit businesses

1.3: List and explain the four factors of production

1.4: Identify the primary functional areas within a business

1.5: Identify business stakeholders

1.6: Identify the external forces that shape the business environment
 Why it Matters: The Role of Business
Why discuss the role of business in society?

Look All Around You The Things We

Touch
See
Eat

What Do All Of These Things Have In Common Feel

(see hyperlink)
(see hyperlink)

Hyperlink to Text
What Is Business?
Learning Outcomes: What Is Business?

I Will Be Able To …

1.1: Explain the concept of business

• 1.1.1: Define the term business

• 1.1.2: Distinguish between profit, loss, and value
• 1.1.3: Distinguish between goods and services
What is a Any activity that provides goods or
services to consumers in order to
business? make a profit.
Goods and Services

• Goods are “tangible” – can be touched

• Examples of goods that are tangible - cars, televisions, or soda.

• Services are “intangible” – cannot be touched (actions performed for money)

• Examples of services that are intangible - haircuts, internet service, or roller-coaster rides.

NOTE: WE WILL USE THE TERM “PRODUCT” TO REPRESENT BOTH “GOODS AND SERVICES

• Businesses goal is to generate profits …from the sale of products (goods and services)
Retailers sell goods
Waiters/Waitresses provide a service
• What is the difference between
tangible and intangible?

• What is the difference between a

good and service?

• One example of a good is ….?

• One example of a service is ….?

Profit, Loss, and Value

Profit is the amount of income (money in/revenue)

that a business owner has left after paying all the

expenses (money out).

If the expenses (money out) of a business is more

than its income (money in), then the business will

suffer a loss.

Businesses who do not make profits over a period

of time will end up closing.
Profit, Loss, and Value

When businesses talk about value they are

referring to the relationship between …

the price a customer pays for the good or

service
and
the perceived benefits the customer receives in
exchange.
Practice Question 1

How do you define “profit”?

A. when revenue exceeds costs

B. when costs exceed revenue

C. when revenue achieves planned target

D. when the bottom line is in the red

Practice Question 1

How do you define “profit”?

A. when revenue exceeds costs

B. when costs exceed revenue

C. when revenue achieves planned target

D. when the bottom line is in the red

Practice Question 2

How do you define “loss”?

A. when costs fall lower than projection

B. when the bottom line is in the black

C. when revenue exceeds costs

D. when costs exceed revenue

Practice Question 2

How do you define “loss”?

A. when costs fall lower than projection

B. when the bottom line is in the black

C. when revenue exceeds costs

D. when costs exceed revenue

Practice Question 3

How do you define “value”?

A. when the perception of competition is
too expensive

B. the perceived benefits by a customer

of price to the time and money spent

C. when market research establishes the

floor price

D. when a customer purchases for the

lowest price in town
Practice Question 3

How do you define “value”?

A. when the perception of competition is
too expensive

B. the perceived benefits by a customer

of price to the time and money spent

C. when market research establishes the

floor price

D. when a customer purchases for the

lowest price in town
 Practice Question 4
Alice takes her car to the dealership for maintenance (oil change, tire rotation, etc.) Alice receives a call
from the dealership later that day stating they have completed the maintenance but noticed there is serious
wear in her two front tires and recommends replacing the tires. Alice agrees and tells the dealership that she
will purchase the tires. Has the dealership provided a good or a service for Alice?

A. The dealership has provided a service

B. The dealership has provided a good

C. The dealership has provided neither a
good or a service
D. The dealership has provided both a
good and a service
 Practice Question 4
Alice takes her car to the dealership for maintenance (oil change, tire rotation, etc.) Alice receives a call
from the dealership later that day stating they have completed the maintenance but noticed there is serious
wear in her two front tires and recommends replacing the tires. Alice agrees and tells the dealership that she
will purchase the tires. Has the dealership provided a good or a service for Alice?

A. The dealership has provided a service

B. The dealership has provided a good

C. The dealership has provided neither a
good or a service
D. The dealership has provided both a
good and a service
 11
Shocking Facts
About The
World’s Biggest
Brands
For-Profit vs. Nonprofit
Learning Outcomes: For-Profit vs. Nonprofit

I Will Be Able To …

1.2: Distinguish between “for-profit” and “nonprofit businesses”

• 1.2.1: Explain the purpose of for-profit businesses

• 1.2.2: Explain the purpose of nonprofit businesses
• 1.2.3: Distinguish between for-profit and nonprofit businesses
Nonprofit Businesses

A nonprofit (not-for-profit) business is a business who does not have the goal of making a
profit
• Instead, it uses those profits to support a cause, provide a public service, or assist others.

Examples

• American Red Cross

• SPCA (Society for the Prevention of Cruelty to Animals)

• American Cancer Society

For-profit vs. Non-profit Businesses

For-Profit Business Non-Profit Business

• Provides goods or services to consumers • Provides goods or services in order to
for the purpose of making a profit generate income that furthers its mission
Comparing For-Profits and Nonprofits
For-Profit
Incurs expenses for operations
Provides goods and services for
customers
Generates revenues from sales
Owned by individuals, partners, or
shareholders
Profit is used to pay owners, partners, and Profit is used to further the mission of the
shareholders
Pays salaries to employees and managers
Profits are subject to taxation by local,
state, and federal authorities
Not-for-Profit/Nonprofit
Incurs expenses for operations
Provides goods and services for
customers
Generates revenues from sales and/or
contributions
Operated by board of directors,
trustees, or managers
organization
Pays salaries to to employees and
managers
Profits are NOT subject to taxation by
local, state, and federal authorities
Practice Question 1

The purpose of a for-profit business is:

A. Donate profits to a local or national charity

B. Return profits to the owners of the business

C. Break even on costs and revenues

D. Establish salaries and benefits for its employees

Practice Question 1

The purpose of a for-profit business is:

A. Donate profits to a local or national charity

B. Return profits to the owners of the business

C. Break even on costs and revenues

D. Establish salaries and benefits for its employees

Practice Question 2

The purpose of a nonprofit business is:

A. Collect donations for its work

B. Utilize volunteers to carry out the work of the organization

C. Return profits to the owners of the business

D. Direct any and all profits to a charitable cause, or organization

dedicated to helping others
Practice Question 2

The purpose of a nonprofit business is:

A. Collect donations for its work

B. Utilize volunteers to carry out the work of the organization

C. Return profits to the owners of the business

D. Direct any and all profits to a charitable cause, or

organization dedicated to helping others
Practice Question 3
Cathy starts a mobile car detailing business. After some initial growth, she hires two workers to
help her keep up with customer demand. Cathy supplies the materials (soap, wax, etc.) for the
operation which, in addition to paying the employees, constitutes her operating expenses.
Cathy’s revenues exceed her expenses and she donates 10% of her profits from her bank
account to the local Humane Society. Is Cathy’s business a for-profit or nonprofit?

A. Neither, it is a Limited Partnership

B. Neither, it is a community service

C. It is a nonprofit

D. It is a for-profit
Practice Question 3
Cathy starts a mobile car detailing business. After some initial growth, she hires two workers to
help her keep up with customer demand. Cathy supplies the materials (soap, wax, etc.) for the
operation which, in addition to paying the employees, constitutes her operating expenses.
Cathy’s revenues exceed her expenses and she donates 10% of her profits from her bank
account to the local Humane Society. Is Cathy’s business a for-profit or nonprofit?

A. Neither, it is a Limited Partnership

B. Neither, it is a community service

C. It is a nonprofit

D. It is a for-profit
PROFIT AND NON-PROFIT
LEMONADE STANDS

WHAT IS THE MAIN MESSAGE OF THE ARTICLE?

(click picture)
Factors of Production
Learning Outcomes: Factors of Production

I Will Be Able To …
1.3: List and explain the four factors of production required to sustain
a business

• 1.3.1: List the four factors of production

• 1.3.2: Explain the four factors of production
INTRODUCTION VIDEO: FACTORS OF PRODUCTION
(click picture)
Practice Question
What are the four factors of production needed by business to operate?

A. Capital, production lines, entrepreneurship and factories

B. Natural resources, labor, factories and entrepreneurship

C. Natural resources, labor, capital and entrepreneurship

D. Sustainable resources, labor, capital and entrepreneurship

Resources and Factors of Production

• Resources are the inputs used to produce the

outputs (goods and/or services).

• Resources are also called factors of production.

Understanding Factors of Production
• Natural Resources: any natural resource, land, plants, livestock, wind, sun, water, etc.

• Labor: any human service—physical or intellectual. Also referred to as human capital.

• Capital: anything that’s manufactured in order to be used in the production of goods and services—
for example, equipment.

• Entrepreneurship: the ability to recognize a profit opportunity, organize the other factors of
production, and accept risk.
 YOU PUT IT TOGETHER
Factors of Production: Papa Johns Pizza
• Natural resources: Cow-milk, wheat, tomatoes etc

• Labor: Farmer, Papa Johns employees

• Capital: Pizza ovens, store

• Entrepreneurship: Papa John (Schnatter)

Practice Question
Caitlin is a gourmet chef who operates a seaside organic restaurant. Caitlin prefers to utilize
only ingredients that she grows herself and she has decided to produce her own sea salt for her
recipes. This would require the following four factors of production: Labor, in the form of her
staff gathering and boiling; capital, in the form of buckets, filters, jars and stoves;
entrepreneurship, in the form of Caitlin initiating the production of her own sea salt, and;
________, in the form of sea water and sun.

A. sodium chloride

B. reoccurring assets

C. natural resources

D. raw material
Practice Question
Caitlin is a gourmet chef who operates a seaside organic restaurant. Caitlin prefers to utilize
only ingredients that she grows herself and she has decided to produce her own sea salt for her
recipes. This would require the following four factors of production: Labor, in the form of her
staff gathering and boiling salt water; capital, in the form of buckets, filters, jars and stoves;
entrepreneurship, in the form of Caitlin initiating the production of her own sea salt, and;
________, in the form of sea water and sun.

A. sodium chloride

B. reoccurring assets

C. natural resources

D. raw material
 How Is a
Business
Organized and
Run

Business
Departments
Functional Areas
Business Departments (Functional Areas)
Learning Outcomes: Departments (Functional Areas)

I Will Be Able To …

1.4: Identify the primary departments (functional areas) within a business

• 1.4.1: Identify the primary departments within a business

• 1.4.2: Identify key people and explain the activities within each
department
Understanding Business Departments (Functional Areas)
Departments Functions
(Functional Area)

Management Plans, organizes, controls, leads

Operations Transforms resources into products

Marketing/Sales Works to identify and satisfy customer needs

Plans, obtains and manages the business’s

Finance money

Provides knowledge and ideas that help a

Research and
company keep up and ahead of the
Development competition
Management
The main role of managers is to supervise other people’s performance.

Most management activities fall into the following categories:

• Planning: Setting business goals and strategies to achieve those goals

• Organizing: Organizing operations to most effectively get work done

• Controlling: Managing employees to most effectively get work done
• Leading: Managing and motivating employees
Operations

Operations are where inputs (factors of production) are converted to outputs (goods and services).

Operations is the heart of a business

The operations manager is responsible for overseeing the day-to-day business operations
Marketing

Marketing identifies customers’ needs and designs products that meet those needs.

The marketing function includes:

• Promoting products

• Determining how products will be delivered

• Developing a pricing strategy to best sell products
• Building and overseeing a businesses’ social media presence
Finance
• Finance involves planning for, obtaining, and managing a company’s funds/money

• Finance managers plan for both short- and long-term financial needs and company strategies

• Accounting is a crucial part of the Finance functional area.

• Accountants provide managers with information needed to make decisions about company
resources.
Research and Development (R&D)

Research and Development: R&D is staffed with …

• Scientists

• Thought-leaders

• Subject-matter experts

• Industry analysts

… to provide products and knowledge to keep ahead of the competition.

Key People Within Departments (Functional Areas)
Practice Question 1

Which department of a business is

responsible for converting the factors
of production into goods and services?

A. Management

B. Operations

C. Marketing / Sales

D. Finance
Practice Question 1

Which department of a business is

responsible for converting the factors
of production into goods and services?

A. Management

B. Operations

C. Marketing / Sales

D. Finance
Practice Question 2
Sea-Worthy is an ocean shipping company. The
R&D department of Sea-Worthy developed a
new navigation system and the CEO decided the
system could be sold to other shipping companies.

Which department would be responsible for

promoting and selling the new navigation system?

A. Marketing

B. Operations

C. Finance

D. R&D
Practice Question 2
Sea-Worthy is an ocean shipping company. The
R&D department of Sea-Worthy developed a
new navigation system and the CEO decided the
system could be sold to other shipping companies.

Which department would be responsible for

promoting and selling the new navigation system?

A. Marketing

B. Operations

C. Finance

D. R&D
Practice Worksheet
(Worksheet is In Docs Folder)
Stakeholders
Video Lesson

Stakeholder
Theory

List the five (5)

stakeholders
of a business

2:57
Learning Outcomes: Stakeholders

I Will Be Able To …
1.5: Identify business stakeholders and describe their relationship with
business organizations

1.5.1: Describe internal (inside of business) and external (outside of business) stakeholders
Business Stakeholders

A stakeholder is an individual
or a group that has an
interaction with a business.

Who are the

“Internal”
and
“external”
stakeholders
of a business?
Internal Stakeholders

• Internal stakeholders are groups or people who work directly within the business

• managers, employees, and owners

• Managers and employees want their jobs and to earn high wages, so they have a interest
in the success of the business.

• Owners want to maximize their profits

External Stakeholders
External stakeholders are groups or people who do not work inside a business but interact
with it in some way.

External stakeholders can include:

• Customers

• Shareholders

• Creditors

• Federal, state, and local governments

• The local community

• Society

• Suppliers
Practice Question 1
External stakeholders consist of the
following groups

A. Company owners, customers,

community, and government

B. Shareholders, customers, suppliers,

community and government

C. Shareholders, customers, managers,

community and government

D. Shareholders, employees, customers,

community and government
Practice Question 1
External stakeholders consist of the
following groups

A. Company owners, customers,

community, and government

B. Shareholders, customers, suppliers,

community and government

C. Shareholders, customers, managers,

community and government

D. Shareholders, employees, customers,

community and government
Practice Question 2
Identify the Internal stakeholder in the
remaining groups

A. Company owners, customers,

community, and government

B. Shareholders, customers, suppliers,

community and government

C. Shareholders, customers, managers,

community and government

D. Shareholders, employees, customers,

community and government
Practice Question 2
Identify the Internal stakeholder in the
remaining groups

A. Company owners, customers,

community, and government

B. Shareholders, customers, suppliers,

community and government

C. Shareholders, customers, managers,

community and government

D. Shareholders, employees, customers,

community and government
Practice Question 3
Identify the Internal stakeholder in the
remaining groups

A. Company owners, customers,

community, and government

B. Shareholders, customers, suppliers,

community and government

C. Shareholders, customers, managers,

community and government

D. Shareholders, employees, customers,

community and government
Practice Question 3
Identify the Internal stakeholder in the
remaining groups

A. Company owners, customers,

community, and government

B. Shareholders, customers, suppliers,

community and government

C. Shareholders, customers, managers,

community and government

D. Shareholders, employees, customers,

community and government
 A Little
Business Humor

“Knock –
Knock”
External Forces
Learning Outcomes: External Forces

I Will Be Able To …

1.6: Identify the external forces that shape a business

1.6.1: List the external forces that affect businesses

1.6.2: Give examples of how external forces affect a business and its
departments (functional areas)
Understanding External Forces

…and how they influence business

activities

• Businesses cannot control external

forces but they can anticipate
many of them and prepare to deal
with them
Economic Environment

Both the local and national economy can have Coronavirus video here
an impact on businesses! 3 facts

- After what might have been the strongest 2 things interesting

economy in the world ever, today’s U.S. 1 question

economic environment is experiencing
catastrophic results due to the Coronavirus
Legal Environment

There is a minefield of regulations, laws,

and liabilities that companies must deal
with in order to stay in business.

These legal requirements can effect:

• Where businesses are located

• What businesses sell

• How their products are manufactured

• How their products are marketed.

Competitive Environment

Businesses face more competition than

ever before due to:
• New technologies
• The opening up of foreign markets
• The rise of consumer expectations
• The growth of “big box” stores

Example: The local small businesses now

compete against large businesses like
Walmart, Costco, Amazon, etc…
Technological Environment

Business technology like computers, internet,

telecommunications and the internet have
rapidly changed the ways businesses meet
their customer’s wants and needs!

The expansion of internet buying all over the

world has forced many smaller, traditional
brick-and-mortar businesses into e-commerce
competition (online sales) – hard to compete!
Social Environment
The social environment that can impacta business
Includes things such as a societies values, attitudes,
beliefs, needs and wants
• The demographics of America is changing
• By 2050 the Hispanic and Asian populations

are expected to double.

• America is aging, relatively soon the majority
of America will be at retirement age

Corporate Social Responsibility (CSR) also compels

businesses to be “good corporate citizens” by
supporting charities and contributing to local communities
Global Environment

Free trade among nations has allowed goods

and services to flow across international
borders more efficiently and cheaply.

• It’s not just the local economy or even the

national economy that business must track
– they must also keep an eye on the world
economy in order to adapt to changes
Practice Question 1
All of these are considered to be external
forces that affect business EXCEPT

A. Global environment

B. Technological environment

C. Economic environment

D. Traditional environment
Practice Question 1
All of these are considered to be external
forces that affect business EXCEPT

A. Global environment

B. Technological environment

C. Economic environment

D. Traditional environment
Practice Question 2
Wells Fargo Bank recently took a big hit to
its brand image and stock value when it
was discovered that bank employees were
opening new customer accounts without
the knowledge of its’ customers. –
Which external environment can this
development be linked to?

A. The legal environment

B. The competitive environment

C. The social environment

D. The technological environment

Practice Question 2
Wells Fargo Bank recently took a big hit to
its brand image and stock value when it
was discovered that bank employees were
opening new customer accounts without
the knowledge of its’ customers. –
Which external environment can this
development be linked to?

A. The legal environment

B. The competitive environment

C. The social environment

D. The technological environment

 Putting it Together: The Role of Business
Why discuss the role of business in society?

Look All Around You The Things We

Touch
See
Eat

What Do All Of These Things Have In Common Feel

(see hyperlink)
(see hyperlink)

Hyperlink to Text
Class Activity: Identifying External Stakeholders

• Identify a business with which everyone in the group is familiar. This can be a local business
or a national chain.

• For the selected business, identify at least four external stakeholders. Be as specific as
possible.

• For each external stakeholder, consider how it would be impacted by:

• The rapid expansion of the business to include new markets or new products

• A downturn in the economy that would negatively affect the company’s revenues

i.e. the Coronavirus

 PRESENT

Identifying External Stakeholders

Class Discussion: Identifying External Stakeholders

• What did you learned from this activity?

• Did this change the way you view business in general?

• How can the health of a single business can have an impact on the larger community and
economy?
Quick Review
• What is a business?

• What are the primary differences between a for-profit and a non-profit business?

• What factors of production sustain businesses?

• How do resources flow between businesses and households?

• What are the major business functions and what does each do?

• Define a business stakeholder.

• What external forces impact businesses?

SEE INSTRUCTIONS
SMALL GROUP
DISCUSSION: DO
WE HAVE FREE
WILL?
ARE WE FREE
TO CHOOSE OUR
BEHAVIOR?
INTRO TO BUSINESS
 INTRO TO BUSINESS
Timed Multiple Choice Section
● 50 Questions | 35 Minutes

Start: “I can learn

to do
“I don’t know this YET”

anything I
want”

End:

“Challenges help me
#2
Pencil grow” “65% Effort, 35%
Ability”
 INTRO TO BUSINESS
Time Free Response Question
(FRQ)
● One Question-25 Minutes
“I can learn “I don’t know this YET”
to do
Start: anything I
want”

End:
“Challenges help me
grow” “65% Effort, 35%
Ability”
Stan and Beth are trying to learn a new
routine to complete successfully in a dance
competition. Give an example of how the
following could affect their learning or
performance.

● Latent Learning
Jasmine runs a childcare service out of her home. She
babysits and cares for up to eight children a day. She is
also trying to train a new puppy that her own family just
adopted. She is very organized and has a good
relationship with the children in her care, but she
occasionally finds herself overwhelmed by their needs
and is looking for some new techniques to help her
continue to provide the highest level of care to those she
looks after each day.

Part A
Tad, a four-year-old child, often has temper tantrums
which take Jasmine’s attention away from the other
children. Recommend a way in which Jasmine can use
the following techniques to help Tad overcome these
tantrums and behave more appropriately.

● Variable-ratio schedule of reinforcement

Ms. Mckee starts class by saying, “Please
put your phone away.” Students respond by
putting their phones away. After two
weeks, she rings a bell before she says,
“Please put your phone away.” Students
respond by putting their phones away.
After two weeks, she just rings a bell and
the students respond by putting their
phones away.

In the above example identify the

following:

● Conditioned Stimulus
 Quick Write: Does sports
participation deserve a trophy?
Should children get awards just
for showing up and playing
sports (effort) or only get a
trophy for the outcome
(winning)?
Quick Write: Is it true that half
of who you are is imitation?
How much of your personality
can you say has been learned
through observations?
 Quick Write: Why can’t you
stop checking your phone?
Why do you feel so compelled
to open apps? Use principles of
operant conditioning to explain
the behavior.
PIE IN THE
FACE! DON’T
GET HIT WITH
THE WHIPPED
CREAM!
 NBEA

ROLE OF
BUSINESS
UNIT TEST
INTRODUCTION TO BUSINESS
INTRO TO BUSINESS

Write in the “Brain Dump”

section in your mind maps.
Reflect on your growth
throughout this unit and write
down everything you can
remember about the topics in
this unit.
SEE INSTRUCTIONS
BELOW
❏ MODIFY

❏ KWL Chart

❏ Timed Multiple Choice ❏ KWL Chart

Section
❏ Timed Multiple Choice
❏ Timed FRQ Section Section
❏ Peer Grade FRQ, Review ❏ Timed FRQ Section
Answers
❏ Peer Grade FRQ, Review
Answers