Introduction to Business
NBEA
THE ROLE OF
BUSINESS IN
SOCIETY?
INTRODUCTION TO BUSINESS
Unit Learning Outcomes
I Can Discuss …
• the role of business in society
• the primary departments (functions) within a business
• external forces that affect business activities
____________________________________________________________________________
I Will Be Able To …
1.1: Explain the concept of business
1.2: Distinguish between for-profit and nonprofit businesses
1.3: List and explain the four factors of production
1.4: Identify the primary functional areas within a business
1.5: Identify business stakeholders
1.6: Identify the external forces that shape the business environment
For-Profit vs. Nonprofit
Learning Outcomes: For-Profit vs. Nonprofit
I Will Be Able To …
1.2: Distinguish between “for-profit” and “nonprofit businesses”
• 1.2.1: Explain the purpose of for-profit businesses
• 1.2.2: Explain the purpose of nonprofit businesses
• 1.2.3: Distinguish between for-profit and nonprofit businesses
Nonprofit Businesses
A nonprofit (not-for-profit) business is a business who does not have the goal of making a
profit
• Instead, it uses those profits to support a cause, provide a public service, or assist others.
Examples
• American Red Cross
• SPCA (Society for the Prevention of Cruelty to Animals)
• American Cancer Society
For-profit vs. Non-profit Businesses
For-Profit Business Non-Profit Business
• Provides goods or services to consumers • Provides goods or services in order to
for the purpose of making a profit generate income that furthers its mission
Comparing For-Profits and Nonprofits
For-Profit Not-for-Profit/Nonprofit
Incurs expenses for operations Incurs expenses for operations
Provides goods and services for Provides goods and services for
customers customers
Generates revenues from sales Generates revenues from sales and/or
contributions
Owned by individuals, partners, or Operated by board of directors,
shareholders trustees, or managers
Profit is used to pay owners, partners, Profit is used to further the mission of
and shareholders the organization
Pays salaries to employees and managers Pays salaries to to employees and
managers
Profits are subject to taxation by local, Profits are NOT subject to taxation by
state, and federal authorities local, state, and federal authorities
Practice Question 1
The purpose of a for-profit business is:
A. Donate profits to a local or national charity
B. Return profits to the owners of the business
C. Break even on costs and revenues
D. Establish salaries and benefits for its employees
Practice Question 1
The purpose of a for-profit business is:
A. Donate profits to a local or national charity
B. Return profits to the owners of the business
C. Break even on costs and revenues
D. Establish salaries and benefits for its employees
Practice Question 2
The purpose of a nonprofit business is:
A. Collect donations for its work
B. Utilize volunteers to carry out the work of the organization
C. Return profits to the owners of the business
D. Direct any and all profits to a charitable cause, or organization
dedicated to helping others
Practice Question 2
The purpose of a nonprofit business is:
A. Collect donations for its work
B. Utilize volunteers to carry out the work of the organization
C. Return profits to the owners of the business
D. Direct any and all profits to a charitable cause, or
organization dedicated to helping others
Practice Question 3
Cathy starts a mobile car detailing business. After some initial growth, she hires two workers to
help her keep up with customer demand. Cathy supplies the materials (soap, wax, etc.) for the
operation which, in addition to paying the employees, constitutes her operating expenses.
Cathy’s revenues exceed her expenses and she donates 10% of her profits from her bank
account to the local Humane Society. Is Cathy’s business a for-profit or nonprofit?
A. Neither, it is a Limited Partnership
B. Neither, it is a community service
C. It is a nonprofit
D. It is a for-profit
Practice Question 3
Cathy starts a mobile car detailing business. After some initial growth, she hires two workers to
help her keep up with customer demand. Cathy supplies the materials (soap, wax, etc.) for the
operation which, in addition to paying the employees, constitutes her operating expenses.
Cathy’s revenues exceed her expenses and she donates 10% of her profits from her bank
account to the local Humane Society. Is Cathy’s business a for-profit or nonprofit?
A. Neither, it is a Limited Partnership
B. Neither, it is a community service
C. It is a nonprofit
D. It is a for-profit
PROFIT AND NON-PROFIT
LEMONADE STANDS
WHAT IS THE MAIN MESSAGE OF THE ARTICLE?
(click picture)
