INSTRUCTOR’S MANUAL George Dracopoulos
Vanier College and McGill University
Business Essentials
Tenth Canadian Edition Ronald J. Ebert
Professor Emeritus, University of Missouri-Columbia
Ricky W. Griffin
Texas A&M University
George Dracopoulos
Vanier College and McGill University
Frederick A. Starke
Professor Emeritus, University of Manitoba
Table of Contents Introduction to The Instructor’s Manual ............................................................................ iii CHAPTER 1
Understanding the Canadian Business System ........................................1
CHAPTER 2
The Environment of Business ................................................................22
CHAPTER 3
Conducting Business Ethically and Responsibly ...................................47
CHAPTER 4
Entrepreneurship, Small Business, and New Venture Creation ............75
CHAPTER 5
The Global Context of Business ..........................................................107
CHAPTER 6
Managing the Business Enterprise .......................................................171
CHAPTER 7
Organizing the Business Enterprise .....................................................205
CHAPTER 8
Managing Human Resources and Labour Relations ............................235
CHAPTER 9
Motivating, Satisfying, and Leading Employees .................................272
CHAPTER 10 Operations Management, Productivity, and Quality............................308 CHAPTER 11 Understanding Accounting ..................................................................342 CHAPTER 12 Understanding Marketing Principles and Developing Products ..........372 CHAPTER 13 Pricing, Promoting, and Distributing Products ....................................405 CHAPTER 14 Money and Banking .............................................................................438 CHAPTER 15 Financial Decisions and Risk Management .........................................460
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INTRODUCTION TO THE INSTRUCTOR’S MANUAL This Instructor’s Manual is intended for use with Business Essentials, 10th Canadian edition. Each chapter's manual contains the following features: 1. Chapter Synopsis—The key topics that are discussed in the text chapter are concisely summarized here. 2. Chapter Outline—A detailed chapter outline of topic coverage in the chapter is provided. This gives instructors a clear organization scheme for the chapter and helps with planning lectures. 3. Quick Questions—These questions focus on the major topics that are presented in the chapter, and are designed to test whether students understand fundamental issues. 4. In-Class Exercises—Several structured in-class exercises are described and specific directions given for conducting the exercises. The topics covered in these exercises relate to topics that are presented in the text chapter; they will increase student interest and engagement in the topics. 5. Teaching Tips—Numerous teaching tips are presented that help the instructor make topic coverage more interesting. These teaching tips include examples that will clarify concepts for students, interesting scenarios that get students thinking about important issues, and clarifications of topics to increase student understanding. 6. Using the Boxed Inserts—Each chapter in the text contains an opening case and several boxed inserts which are designed to increase student interest. Questions for Discussion or Critical Thinking Questions are provided for students to consider. Answers to these questions are provided for instructors, as well as ideas for in-class discussions and debates on interesting and controversial topics that may relate to the issues raised in the insert. 7. Questions and Exercises—At the end of each chapter in the text, several Questions for Analysis and Application Exercises are presented. Answers to the questions and exercises are provided for instructors. 8. Team Exercises—Three team exercises are found at the end of each chapter in the text: Building a Business: Continuing Exercise, Building Your Business Skills, and Exercising Your Ethics. Answers to the questions raised in these exercises are provided. Suggestions for in-class activities related to these exercises are also provided. 9. Case Analysis—A case study is presented at the end of each chapter in the text. Included at the end of the case study are Questions for Discussion which ask students to use concepts presented in the chapter to analyze the case. Answers to these questions are provided for the instructor.
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10. Crafting a Business Plan—The business plan feature is found at the end of each major section of the text (i.e., at the end of Chapters 5, 9, 11, 13, and 15). Further information for instructors is provided here.
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CHAPTER 1 UNDERSTANDING THE CANADIAN BUSINESS SYSTEM CHAPTER SYNOPSIS Chapter 1 creates a context for understanding the business concepts that are presented throughout the text. This chapter presents the ideas of business and profit, outlines the world’s major economic systems, and describes the key aspects of Canada’s market economy, including markets, demand, supply, private enterprise, and the different degrees of competition that are evident in various industries. An Appendix at the end of the text provides a brief history of business in Canada. CHAPTER OUTLINE I.
THE IDEA OF BUSINESS AND PROFIT A business is an organization that seeks to earn profits by providing goods and services to customers. Profit is what remains after a business’s expenses incurred are subtracted from its sales and revenues. Profits are what encourage people to open and expand business and are required for the organization to be “a going concern.” In Canada, not-for-profit organizations such as charities, educational institutions or government agencies are also important. As the term suggests, these are organizations that do not try to make a profit; instead, they use the funds they get from government grants or from the sale of goods and services to provide various services to the public.
II.
ECONOMIC SYSTEMS AROUND THE WORLD An economic system is the way in which a nation allocates its resources among its citizens. Various systems differ in terms of who owns or controls these resources, or “factors of production.” A. Factors of Production—The basic resources used by a business to produce goods and services include natural resources, human resources, capital, entrepreneurs, and information. 1.
Labour—The people who work for a company.
2.
Capital—The funds needed to operate a business.
3. Entrepreneurs—Those people who accept the opportunities and risks involved in creating and operating a business. 4. Natural resources—Land, water, mineral deposits, trees and other naturally occurring resources that businesses need to operate. .