Chapter 2.05 Vocab

3. risks The possibility of loss or failure from human error.
4. risk The possibility of loss (failure) or gain (success) inherent in conducting business.
5. A risk-response strategy that involves assuming responsibility for the risk rather than transferring it.
8. competition A type of rivalry between or among businesses that focuses on the use of price to attract scarce customer dollars.
11. risks The possibility of loss or failure from nature.
12. Monetary reward a business owner receives for taking the risk involved in investing in a business; income left once all expenses are paid (income – expense = profit).
15. risks Chances of loss that may result in loss, no change, or gain.
17. The money received by resource owners and by producers for supplying goods and services to customers.
18. risks Chances of loss that carry with them the possibility of loss or no loss.
20. A risk-response strategy that involves choosing not to do something that is considered risky.
22. A market structure in which there are relatively few sellers, and industry leaders usually determine prices.
23. profit Money left after the cost-of-goods expense is subtracted from total income (income from sales - cost of goods = gross profit).
24. A risk-response strategy that involves moving the impact of a risk to someone or something else.

1. competition Rivalry between or among businesses that offer dissimilar goods or services.
2. competition Rivalry between or among businesses that offer similar types of goods or services.
6. competition A market structure in which there are many businesses selling a lot of identical products for about the same price to many buyers; also known as pure competition.
7. A type of market structure in which a market is controlled by one supplier, and there are no substitute goods or services readily available.
9. A risk-response strategy that involves trying to reduce the chance of loss or severity of loss.
10. The money that a business spends.
11. competition A type of rivalry between or among businesses that involves factors other than price.
13. expenses All of the expenses involved in running a business.
14. profit Money left after the cost-of-goods expense and the operating expense are each subtracted from the total income (gross profit - operating expense = net profit).
16. monopolies Monopolies that the government allows to exist legally under controlled conditions.
19. risk The possibility of loss or failure that occurs as a result of the economy.
21. of goods The amount of money a business pays for the products it sells or for the raw materials from which it produces goods to sell; the amount of money a business pays for the products (or for any part of the products) it sells.