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5-1 Business in the U.S. Economy 5-2 Forms of Business Ownership

C H A P T E R. 5. Economic Decisions and Systems. 5-1 Business in the U.S. Economy 5-2 Forms of Business Ownership 5-3 Organizational Structure for Businesses. BUSINESS AND THE ECONOMY. Size of U.S. businesses Roles of business Impact on a community.

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5-1 Business in the U.S. Economy 5-2 Forms of Business Ownership

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  1. C H A P T E R 5 Economic Decisions and Systems 5-1 Business in the U.S. Economy 5-2 Forms of Business Ownership 5-3 Organizational Structure for Businesses

  2. BUSINESS AND THE ECONOMY • Size of U.S. businesses • Roles of business • Impact on a community

  3. PERCENT OF BUSINESSES BY EMPLOYEE SIZE

  4. BUSINESS ACTIVITIES • Generating ideas • Raising capital • Employing and training personnel • Buying goods and services • Marketing goods and services • Maintaining business records

  5. TYPES OF BUSINESSES • Producers • Intermediaries • Service businesses

  6. Checkpoint  • How does a manufacturer differ from an extractor? • An extractor takes natural resources, such as oil or timber, for direct consumption or for use in developing other products. • A manufacturer takes resources supplied by others and converts them into useable products.

  7. BUSINESS OWNERSHIP • Proprietorship • Partnership • Corporation

  8. Forms of Ownership

  9. CHOOSING A FORM OF BUSINESS OWNERSHIP • Choosing a proprietorship • Choosing a partnership • Choosing a corporation

  10. Checkpoint  • Which form of business ownership is the most complex and difficult to form? • The corporation is more complex to begin than other business forms. • Forming a corporation requires much more bureaucracy, is more subject to government regulations, requires the organization of a board, and must have clearly defined bylaws.

  11. Checkpoint  • What are the other specialized forms of business ownership? • Limited liability partnership • Joint venture • S corporation • Limited liability company (LLC) • Nonprofit corporation

  12. DESIGNING AN EFFECTIVE BUSINESS ORGANIZATION • Setting direction • Principles of effective organization • Responsibility, authority, and accountability • Unity of command • Span of control

  13. Checkpoint  • What is the difference between a mission statement and a goal? • A mission statement states the purpose of existence for a business and what it hopes to achieve. • A goal is a more specific statement of what a business expects to achieve and may be used to measure a business’ success.

  14. TYPES OF ORGANIZATIONAL STRUCTURES • Functional organization structure • Matrix organizational structure

  15. BUSINESS ORGANIZATION CHART

  16. Checkpoint  • What problems can result from the use of a functional organizational structure? • Employees in a functional organizational structure may tend to lose sight of overall corporate goals. • Workers tend to be limited to specific duties and may not see their relationship to the organization as a whole. • This can result in lack of interest and motivation over time.

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