2.05 Key Terms

A risk-response strategy that involves choosing not to do something that is considered risky.

The possibility of loss (failure) or gain (success) inherent in conducting business.

The rivalry between two or more businesses to attract scarce customer dollars.

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.

Rivalry between or among businesses that offer similar types of goods or services.

The possibility of loss or failure that occurs as a result of the economy.

The money that a business spends.

Money left after the cost-of-goods expense is subtracted from total income (income from sales - cost of goods =).

The possibility of loss or failure from human error.

The money received by resource owners and by producers for supplying goods and services to customers.

Rivalry between or among businesses that offer dissimilar goods or services.

The type of market, or environment, in which businesses operate.

A type of market structure in which a market is controlled by one supplier, and there are no substitute goods or services readily available.

The possibility of loss or failure from nature.

Money left after the cost-of-goods expense and the operating expense are each subtracted from the total income (gross profit - operating expense =).