Economics Vocabulary Chapter 3
Terms
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- business owned and run by one person
- sole proprietorship
- the owner is personally and fully responsible for all losses and debts of the business
- unlimited liability
- stock of finished goods and parts of reserve
- inventory
- the firm legally ceases to exist when the owner dies, quits, or sells the business
- limited life
- business jointly owned by two or more person
- partnership
- the investor's responsibility for the debts of the business is limited by the size of his or her investment in the firm
- limited partnership
- court-granted permission to an individual or business to cease or delay debt payments
- bankruptcy
- form of business organization recognized by law as a seperate legal entity having all the rights of an individual
- corporation
- government document that gives permission to create a corporation
- charter
- ownership certificates in the firm
- stock
- person who owns a share/shares of stock in a corporation
- stock/shareholders
- check representing a portion of the corporate earnings
- dividend
- written promise to repay the amount borrowed at a later date
- bond
- amount borrowed
- principal
- price paid for the use of another's money
- interest
- feature of taxation that allows stockholders dividents to be taxed both as corporate profit and as personal income
- double taxation
- combination of two or more business to form a single firm
- merger
- report showing a business's sales, expenses, and profits for a certain period
- income statement
- measure of a business profits determined by subtracting all expenses, including taxes, from revenues
- net income
- non-cash charge the firm takes for the general wear and ear on its capital goods
- depreciation
- sum of net income and non-cash charges such as depreciation is the bottom line or real measure of profits for business
- cash flow
- takes place when two or more firms that produce the same kind of product join forces
- horizontal merger
- when firms involved in different steps of manufacturing or marketing join together
- vertical merger
- firm that has at least four businesses, each making unrelated products, none of which is responsible for a majority of its sales
- conglomerate
- corporation that has manufacturing or service operations in a number of different countries
- multinational
- operates in businesslike way to promote the collective interests of its members rather than to seek financial gain for its owners
- nonprofit organization
- a voluntary association of people formed to carry on some kind of economic activit that will beneit its members
- cooperative/co-op
-
financial organization that accepts deposits from and make loans to employess of a particular company or government agency
(non-profit) - credit union
- an organization of workers formed to represent its members' interests in various employment matters
- labor union
- process of negotiation between union and management representatives over pay, benefits, and job relating matters
- collective bargaining
- group of people in a specialized occupation that works to improve the working conditions, skill levels, and public perceptions of the profession
- professional association
- nonprofit of local businesses whose purpose is to promote their interests
- chamber of commerce
- nonprofit organization sponsored by local businesses to provide general information on companies
- better business bureau
- investor- or municipal-owned companies that offer important products to the public
- public utilities