What is Entrepreneurship?
1.1Section obectives
Discuss the role of small business and entrepreneurship in the economy.
Describe economic systems. Explain how economics is about making choices.
Discuss the role of economic indicators and business cycles.
Describe what entrepreneurs contribute to the economy.
Entrepreneurship
As an entrepreneur, you accept the risks and responsibilities of business ownership.
entrepreneur an individual who undertakes the creation, organization, and ownership of a business
Creating and running a business venture requires a variety of skills.
venture a new business undertaking that involves risk
Entrepreneurship vs. Entrepreneurial
1.the process of recognizing an opportunity, testing it in the market, and gathering resources necessary to go into business
2.acting like an entrepreneur or having an entrepreneurial mind-set
Entrepreneur About one in three households is involved in an entrepreneurial enterprise.
Most businesses, 90%, are small businesses with fewer than 100 employees.
Entrepreneurship Why is owning and operating a business today much different than the past???
The global marketplace and Information Technology have opened new markets
Question: How do entrepreneurs relate to the economy?
Entrepreneurship Today Knowledge of economics contributes to an understanding of how entrepreneurs and customers interact.
economics the study of how people allocate scarce resources to fulfill their unlimited wants
Economic Systems
An economic system includes a set of laws, institutions, and activities that guide economic decision making
All economic systems attempt to answer four basic questions.
1.What goods and services should be produced?
2.What quantity of goods and services should be produced?
3.How should goods and services be produced?
4.For whom should goods and services be produced?
The Free Enterprise System Most democratic nations have a free enterprise system. A free enterprise system is also known as capitalism or a market economy.
With a Free Enterprise System
1.People can choose what to buy.
2.They can choose to own private property.
3.They can choose to start a business and compete.
The Free Enterprise System
What is the primary incentive of free enterprise?
PROFIT - money that is left over after all expenses of running a business have been deducted from the income