Introduction to Business (Bus100)
Professor Gerald Huff
November 3, 2012
Imagine a world without business. You’d hunt and gather your own food, make your own clothes, have no vehicle for transportation, not being able to see what’s happening in world because you haven’t made your television, let alone finding the material to do so, the cost of living would be minimal. It seems like a scary place. Luckily, in our world today businesses surround us. With these businesses we have economic wealth and a higher cost of living. We have a foundation that we rely on, the factors of production. Natural resources, which includes using the land (not being made with human hands), wind, and water. We have capital that includes machines, tools, and technology. Computers are a huge part of capital. They can help businesses see growth, send an email to corporate, just to name a few. We have human resources that help companies connect with their employees. They help resolve issues in the workplace whether it’s positive or negative. The Entrepreneurs, the risk takers that want to succeed in life by creating their own company and/or product. Though small, small businesses still help the economy, creating jobs, and assisting with cost of living.
In September 2008 the US economy plunged into the worst fiscal crisis since the Great Depression. Huge, venerable financial institutions faces collapse, spurring unprecedented bailouts by the Federal Governments (1). By using the fiscal policy the government should have reevaluated the "tax brackets" to this day I don't know why the middle class seems to be paying more out of pocket. If you make more money you should be paying more taxes, it just seems like common sense. This could have perhaps prevented the recession. For monetary policy they should have reviewed the interest rates and the supply of money. A few years back it seemed that everyone could have been approved for a mortgage (even if they couldn't afford it in the long run). I believe if the government had taken more initiative and paid attention to what loans we're being processed, let alone the presidents and CEO's of these lenders, we wouldn't be looking at so many foreclosures. Then we bailed out these companies?! I mean honestly, we gave money to people who couldn't afford it in the long run.
Non-profits never needed a bailout. A nonprofit entity has a mission that benefits the "greater good" of the community, society, or the world. It does not pay taxes, but it also cannot use its funds for anything other than the mission for which it was created. These organizations play a critical role in the economy. They help improve the quality of life in our society. Focusing on areas such as health, human services, education, art, religion, and culture, nonprofits are business-like establishments, but their primary goals do not include profits (2). For-profit organizations are the opposite, they provide a service or a good but the money is dispersed differently. For example, when you start a business, it is for the financial benefit of its owners and/or shareholders. Profit is the goal and the business pays taxes on that profit.
Businesses are always looking for ways to expand their market. Some may seek going global. Let’s use Starbucks as an example. Just recently Starbucks opened its first store in Mumbai, India. For the flagship Mumbai store, Starbucks chose the historic Elphinstone Building in the Horniman Circle neighborhood of south Mumbai, not far from a vast Hermes shop and a stately local park maintained with funds from the family foundation of Italian designer Ermenegildo Zegna.
