Understanding Gross Domestic Product (GDP) and Macroeconomic Concepts
Understanding Gross Domestic Product (GDP)
The Gross Domestic Product (GDP) represents the market value of all final goods and services produced within an economy during a specific period. It can be calculated by summing the value of all final goods and services produced, or by totaling all expenditures within the economy. GDP can be measured as the total final expenditure on the economy’s production. This expenditure is divided into consumption expenditure (C), government expenditure (G), investment
Read MoreCustomer-Centric Strategies for Business Success
Focus on the Customer
The Customer Comes First
Excellent companies exhibit:
- A bias for action, rather than just planning or waiting for something to happen.
- Keeping close to the customer by learning from them.
- Encouraging the development of leaders and innovators by supporting creativity and risk-taking.
- Focusing on core competencies.
- Practicing a value-driven approach, by concentrating on achievements rather than technological or economic resources or organizational structure.
- Recognizing the main productivity
Understanding Business Enterprises: Types, Accounting, and Financial Reporting
Understanding Business Enterprises
An enterprise is a company organized for commercial purposes, a business firm operating within an economic system where goods and services are exchanged for money. Every business requires productive resources: land, plant and equipment, inputs and raw materials, labor, capital, and management. By using these resources, an enterprise makes, trades, and sells goods or services to obtain profit.
Types of Enterprises
Based on Goods or Services
- Service Business: Provides
Understanding Currency Exchange Rates and Economic Systems
Types of Exchange Rates
Nominal Exchange Rates
The nominal value is simply the price of one currency in terms of another. Changes in the nominal exchange rate of one country’s currency with that of another will affect the transaction price of goods and services bought and sold between these two countries. (Inflation is not taken into account so they are not REAL VALUES)
Trade Weighted Index
It measures the value of a currency against a basket of currencies of other countries which are weighed according
Read MoreStrategic Business Analysis: SWOT, PEST, Ansoff, and Boston Matrix
SWOT Analysis
SWOT analysis originated from research conducted at the Stanford Research Institute between 1960 and 1970. This research, funded by Fortune 500 companies, aimed to understand and address the failures in corporate planning. SWOT, an acronym for Strengths, Weaknesses, Opportunities, and Threats, is a valuable tool for decision-making in various business situations.
SWOT analysis provides a framework for reviewing strategy, position, and direction. It is useful in brainstorming meetings
Read MoreUnderstanding Macroeconomics: Key Concepts and Objectives
Macroeconomics
Macroeconomics is a sub-science of economics that studies the interrelation among economic agents, generating economic indicators.
Economic Agents
- Households (families) → Consumption
- Firms (producers) → Investment to produce goods and services
- Public sector → Provides services (Consumption + Investment)
- External sector → Rest of the world (Consumption + Investment)
Markets
Markets are physical or virtual places or institutions where goods and services are exchanged for money.
- Goods