Name __________Yuxin Wang_________________

Chapter 1
1. What is the difference between revenue and profit?
Revenue is the total amount of money a business takes in during a given period by selling goods and services.

Profit is the amount of money a business earns above and beyond what it spends for salaries and other expenses needed to run the operation.
2. What is the difference between standard of living and quality of life?
The term standard of living refers to the amount of goods and services people can buy with the money they have.

The term quality of life refers to the general well-being of a society in terms of its political freedom, natural environment, education, health care, safety, amount of leisure, and rewards that add to the satisfaction and joy that other goods and services provide.
3. What is risk, and how is it related to profit?
Risk is the chance an entrepreneur takes of losing time and money on a business that may not prove profitable.

Not all enterprises make the same amount of profit. Those that take the most risk may make the most profit.
4. What do the terms stakeholders, outsourcing, and in-sourcing mean?
Stakeholders are all the people who stand to gain or lose by the policies and activities of a business and whose concerns the business needs to address.

Outsourcing means contracting with other companies (often in other countries) to do some or all the functions of a firm, like its production or accounting tasks.

The other side of the outsourcing coin is insourcing. Many foreign companies are setting up design and production facilities here in the United States.

5. What benefits do you lost by being an entrepreneur, and what do you gain?
As an entrepreneur, you don't receive any benefits such as paid vacation time, day care, a company car, or health insurance.

You gain-freedom to make your own decisions, opportunity, and possible wealth-is often worth the effort.

6. What are the five factors of production? Which ones seem to be the most important for creating wealth?
1. Land (or natural resources).
2. Labor (workers).
3. Capital. (This includes machines, tools, buildings, or whatever else is used in the production of goods. It may not include money; money is used to buy factors of production but is not always considered a factor by itself.)
4. Entrepreneurship.
5. Knowledge.

Knowledge is be the most important for creating wealth
7. What are four ways the government can foster entrepreneurship?
One of the best things the governments of developing countries can do is to