|Home||Chapter 2||Glossary: Idiomatic and Key Terms Glossary|
aggregate output: Total quantity of goods and services produced by an economic system during a given period.
applied R&D: Focusing specifically on how a technological innovation can be put to use in the making of a product or service that can be sold in the marketplace.
balance of trade: The total of a country's exports (sales to other countries) minus its imports (purchases from other countries).
basic (or pure) R&D: Improving knowledge in an area without a primary focus on whether any discoveries that might occur are immediately marketable.
budget deficit: The result of the government spending more in one year than it takes in during that year.
business cycle: Pattern of short-term ups and downs (expansions and contractions) in an economy.
business process management: Approach by which firms move away from department-oriented organization and toward process-oriented team structures that cut across old departmental boundaries.
consumer price index (CPI): Measure of the prices of typical products purchased by consumers living in urban areas.
core competency: Skills and resources with which an organization competes best and creates the most value for owners.
deflation: A period of generally falling prices.
depression: Particularly severe and long-lasting recession.
economic environment: Conditions of the economic system in which an organization operates.
enterprise resource planning (ERP): Large-scale information system for organizing and managing a firm's processes across product lines, departments, and geographic locations.
external environment: Everything outside an organization's boundaries that might affect it.
fiscal policies: Policies by means of which governments collect and spend revenues.
gross domestic product (GDP): Total value of all goods and services produced within a given period by a national economy through domestic factors of production.
gross national product (GNP): Total value of all goods and services produced by a national economy within a given period regardless of where the factors of production are located.
inflation: Occurrence of widespread price increases throughout an economic system.
monetary policies: Policies by means of which the government controls the size of the nation's money supply.
national debt: The total amount of money that Canada owes its creditors.
nominal GDP: GDP measured in current dollars or with all components valued at current prices.
organizational boundary: That which separates the organization from its environment.
outsourcing: Strategy of paying suppliers and distributors to perform certain business processes or to provide needed materials or services.
political-legal environment: Conditions reflecting the relationship between business and government, usually in the form of government regulation.
process: Any activity that adds value to some input, transforming it into an output for a customer (whether external or internal).
productivity: Measure of economic growth that compares how much a system produces with the resources needed to produce it.
purchasing power parity: Principle that exchange rates are set so that the prices of similar products in different countries are about the same.
R&D intensity: R&D spending as a percentage of a company's sales revenue.
real GDP: GDP calculated to account for changes in currency values and price changes.
recession: Period during which aggregate output, as measured by real GDP, declines.
research and development (R&D): Those activities that are necessary to provide new products, services, and processes.
socio-cultural environment: Conditions including the customs, values, attitudes, and demographic characteristics of the society in which an organization functions.
stability: Condition in an economic system in which the amount of money available and the quantity of goods and services produced are growing at about the same rate.
stabilization policy: Government policy, embracing both fiscal and monetary policies, whose goal is to smooth out fluctuations in output and unemployment and to stabilize prices.
standard of living: Total quantity and quality of goods and services that a country's citizens can purchase with the currency used in their economic system.
technology transfer: The process of getting a new technology out of the lab and into the marketplace.
technology: All the ways firms create value for their constituents.
unemployment: Level of joblessness among people actively seeking work in an economic system.
vertical integration: Strategy of owning the means by which an organization produces goods or services.
viral marketing: Strategy of using the internet and word-of-mouth marketing to spread product information.