Ch 8: Business Organization & Decision Making
About This Chapter
Business Organization and Decision Making - Chapter Summary
In this chapter, you will find out exactly what makes a business organization a unique entity and learn about the different business structures prevalent today. You'll be introduced to the sole proprietorship, partnerships, limited liability companies (LLCs), corporations, franchises, and more. Learn what is meant by entrepreneurship and how it is influenced by the economy. At the end of this chapter, you should be able to:
- Define a business organization
- Discuss the different types of business structures and their advantages and disadvantages
- Explain entrepreneurship and how it is influenced by the economy
- Identify the seven steps of decision making in businesses
- Explain the principle of rational choice in economics
- Discuss what is meant by economic profit, and know how to calculate it
- Distinguish between implicit and explicit costs
These lessons include short, engaging videos that make learning fun. Along with the video lessons, there are self-assessment quizzes and lesson transcripts to deepen your comprehension. You'll be presented with the key terms you need to remember, and you'll find video tags that take you to the exact location in a video that you wish to review. All these lesson components have been developed by instructors who are professionals in their field.
1. What Is a Business Organization? - Structure, Types & Examples
A business organization may exist as a variety of entities, with differences in structure and liability. Explore the details of both limited and unlimited liability organizations through examples of each distinct type.
2. What is a Sole Proprietorship? - Definition, Advantages, Disadvantages & Examples
A sole proprietorship is a small business with one owner. Explore the definition of a sole proprietorship, examine its various advantages and disadvantages, and understand the examples.
3. The Basics of Partnerships: Types & Examples
Partnerships are a common way to organize a business in the United States. Learn about different types and examples of partnerships and their advantages and disadvantages.
4. The Basics of LLCs: Limited Liability Companies
A limited liability company, or LLC, is a kind of business association with traits of both corporations and partnerships. They are created when members file articles of organization with the secretary of state. Discover the basic characteristics of an LLC, such as member-managed vs. manager-managed organization, limited liability, and pass-through taxation.
5. Corporations: Types, Advantages, Disadvantages & Examples
A corporation is an organization that is considered as a single business separate entity from its owners. Learn more about the corporate form of organization and its examples, the advantages and disadvantages of corporations, as well as the differences between S-corporations and C-corporations.
6. Franchises: Opportunities and Challenges
A franchise is a business relationship where a company gives permission to a person or business to use the company's name and business practices to start their own business. Explore the advantages and disadvantages of starting a franchise, as well as the challenges of diversity and globalization in the practice.
7. The Role of Cooperatives in Business
In business, a cooperative is an organization owned by the people who are members of the organization. Learn about the role of cooperatives in business, explore the different types, and understand how cooperatives function in the economy and society.
8. Entrepreneurship & the Economy: Definition & Importance
Many people choose to take the risk to become an entrepreneur. Learn to define entrepreneurship, identify different types of entrepreneurs, and examine its role and importance in the economy. Also explore the factors of production and how entrepreneurship is an engine for growth and innovation.
9. The Seven Steps of Decision Making
Effective decision-making is an essential skill for every manager, and it can be broken down into seven steps. Learn about a seven-step process for effective decision-making, from decision identification to review an assessment and everything in between.
10. Principle of Rational Choice in Economics: Theory & Analysis
The principle of rational choice in economics is the idea that people make decisions most beneficial to themselves. Further explore the theory and analysis of the principle of rational choice and analyze a real world example.
11. Intuitive Decision Making in Business and Management
Intuitive decision making, or relying on gut instinct, can be helpful in business and management decisions. Learn an example of intuitive decision making, how it is different from rational decision making, and the elements of intuition.
12. How to Calculate Economic Profit: Definition & Formula
Economic profit is the difference between the revenue a company has received from its outputs and the opportunity costs of its inputs. One of the ways a company understands if business decisions are good business decisions is by calculating economic profit. Further explore the definition and learn the formula used to calculate economic profit.
13. Implicit Costs: Definition & Examples
There are two types of costs that must be considered by a business; explicit costs and implicit costs. Learn more about the definition and examples of implicit costs such as lost profits and benefits without expenditures.
14. Explicit Costs: Definition & Examples
Explicit costs are the actual costs incurred and payments made by a business that directly affect its profitability. Learn about the definition of explicit costs and explore common examples of this type of cost.
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Other Chapters
Other chapters within the GACE Economics (538): Practice & Study Guide course
- About the GACE Test
- Basic Economic Concepts & Terms
- Scarcity, Choice & The Production Possibilities Curve
- Comparative & Absolute Advantage, Specialization & Trade
- Supply, Demand & Market Equilibrium
- Determining Price in Economics
- Government Issues in Economics
- Producers & Production in Microeconomics
- Understanding Macroeconomic Equilibrium
- Scarce Economic Resource Markets Basics
- Economic Market Structures
- Basics of Measuring the Economy
- Understanding Economic Growth and Productivity
- Inflation & Adjustment in Economics
- Unemployment Basics
- Understanding Inflation & Unemployment
- Overview of Aggregate Demand & Supply
- Fiscal Policy & Monetary Policy
- Expansionary & Contractionary Gaps
- Money & the Market
- The Central Bank & Monetary Policy
- Foreign Exchange & Trade Balance
- Overview of Inflows, Outflows & Restrictions
- Personal Finance: Consumer Decision Making
- Personal Finance: Savings & Investments
- GACE Economics Flashcards