"Commerce is a game of skill which everyone cannot play and few can play well”

UNIT I-BASIC CONCEPTS IN ECONOMICS

INTRODUCTIONIn this unit, the study of economics must essentially embark with the familiarization of the fundamental ideas that are used and dealt with the
discussion and /or analysis of economic conditions, processes, actions or polies. Although most of the basic concepts of economics had been encountered by the
average reader, it is necessary to present them for review and emphasis.Today, people are becoming concern about economics. The present economic situation seem
to interest everybody in the society. It comes as a challenge for all of us to have a knowledge on the things that is happening in the country.LEARNING OBJECTIVESAt
the end of the topic, the students will be able to:1. Know what is economics and its branches2. Identify critical aspects of economics.3. Explain the causes of business
failures4. Understand the new world order of business ACTIVATING PRIOR LEARNING A. Why is there a need to know the importance of economics? What are things
that you do every day that is related to economics, Make a list of all the things that you do upon waking up and up to the time you sleep at night that has a
connection with economics.B. Let us ponder on the question,” Economics is an inquiry into the nature and causes the wealth of nations”. Each student is given a time
to share their ideas on how they understood the statement. PRESENTATION OF CONTENTS Economics, definedThere are varied definition of Economics presented by
varied authors, economist, etc. some of which are:Economics is the science of resource allocation in the household, firm, government or the society in
order to attain an effective combination that will produce the highest probable result at the least cost.Economics is the scientific technique of
combining the production factors in order toconvert resource inputs to goods and services that will satisfy human wants.Economics is the science
of utilizing scarce resources in the production of goods and services needed by people, business and society for the satisfaction of their
consumption needs.Economics studies how prices of land, labour and capital are determined and how these prices are used to allocate scarce
resources.Economics studies the impact on growth of government spending, taxes and budget deficits. Economics examines the movements in
income and employment during the different stages of the business cycle with the goal of developing government policies that will improve
economic growth and development. Microeconomics is a branch of economics that deals with parts of the economy such as the household and the
business firm, it is also known as the Price theory.Macroeconomics branch of economics that studies the economy as a whole which also known as
the National Income Analysis.

Critical Aspects of Economics Scarce Resources, these are the goods that must be allocated and used in the most effective way possible. These are
inputs used in the process of producing goods and services. Economic Resources, these are inputs used in the production of goods and services.
The essential resources are, land, labour, capital, management, technology and government policy.Resource Payments, the economic resources
have the purpose of getting their own rewards for their function in economic activities. Hence, the used of land is rent; the used of labour is salary
or wages; management is profit, capital is interest and government gets revenues through taxes collected. Price System, is a consequence in the
used of money in exchange of goods and services. Those who decide to buy offer an amount of money, demand. And those who offer goods and
services, supply. When a buyer and a seller agree on a price, a transfer of possession takes place, thus, the interaction of demand and supply is
determined by agreement.Competition, rivalry among sellers who wish to dominate the market by selling the highest quantity of goods thereby
becoming dominant in the market.quantity of goods thereby becoming dominant in the market.

Causes of Business Failures The following are common causes of business failures both economic and managerial:1. Poor selection of location.
There must be a thorough inspection on the location or site when one is planning to put up his own business because poor selection of location will
lead to excessive loss of profit.2. Failure to Diversify. Hands on is very much needed in handling business. Various products could be offered but be
cautious.3. Mismanagement of the cash flow. Inexperience often lead to failure. The lack of a spending program damages cash flow. 4. Overdrive in
the effort to succeed. Initial success can lead to pumping in more capital for expansion of the marketing operation. Failure rather than success will
follow.5. Excessive extension of credits. Too much of bad debts kill the business.6. Employee dishonesty. Dishonest employee may bleed the
business slowly or run with sizeable amount that can cripple the business.7. Poor human relation. Business requires social efficiency.8. Loss of key
personnel. The leadership and profit making action of a manager is lost when he quits or gets pirated.9. Entry of big business into the business.
When giant companies invade small enterprises, the loser are usually the small businesses.10. Dumping of cheap foreign goods into the local
market. Local producers will be greatly affected with the influx of cheap imported goods.11. Passage of unfavourable legislation. Excessive
imposition of high taxes will lead to failure.12. Incompetence of management. Knowledge and experience in the business is always at an advantage.
Hiring experts or consultant is a solution.13. Failure to adopt a marketing and advertising strategy. It is important to properly package a product
and promote it by using multi-media strategy.14. Mixing personal matters with business operations.it is not a good practice to combinebusiness
matters with family matters or personal matters it will only lead to emotional matters or issues.

The New World Order of Business The structure that has emerged in the business environment of the New Millennium is one that departs strongly
from that of the past. Information technology and the globalization of trade have jointly set the stride towards a borderless flow of trade and the
widening opportunities in business. This translate into the new world order of business which is very distinct from the ways of commerce in the
past.E-Commerce, the Internet serves a s a means to advertise and promote the products with the E-mail and digital online serving as a market for
every seller or dealer in the market so that even small establishment with limited product line has a chance to sell large scale in the global market.
E-Banking. On-line banking in complementation with E-commerce work together. Remittances of payments for business in the Internet can be
settled through E-banking and the world of business will be wider and faster.K- Economy. The world-wide availability of knowledge providers to the
global subscribers for systems, procedures, programs and information technology now comprise the so called K-economy that exist in the realm of
business and have respect for corporate ownership and the laws on patent and copyright. APPLICATION Identify an on-line seller and ask the
following information.1. How did he/she started as on-line seller?2. What motivates him/her to go on-line business3. How much is the capital>4.
What are the products offered?5. Is the profit convincing?6. Is on-line selling just a part time or full time engagement? Make a short summary on
what transpired in your conversation. Take note: do the interview online too.FEEDBACK Directions: Read, analyse and write your answer on how
you understood the following statements. 1. What basic goods and services do most of us regard it as scarce resources?2. Which of the common
causes of business failures may arise from taking/using business funds for household or personal spending?3. How does the stage or level of
computerization and computer literacy determine the involvement of a given society in E-commerce?

Project Management topic 1

What is management? Management is the process of planning, organising, leading and controlling the work of organisational members and of
using all available organisational resources to reach specific organisational goals.

Brief history of management theory Pre-industrial management (prior to 1890 ° Ruling of empires, kingdoms, tribes, clans, etc . ° Gurus : Niccolo
Machiavelli, Confucius , Sun Tzu Scientific management (1890 – 1940) ° Industrial revolution era – management based on routinized, mechanistic
processes. Famous example: Ford’s Model T. ° Guru: Frederick Taylor Bureaucratic management (1930-1950) ° Hierarchical organisation
management – line of work/authority/control ° Guru: Max Weber Human relations (1930-today) ° Focus on managing human resource (e.g.
motivation, needs) ° Gurus : Frederick Herzberg, Abraham Maslow 1.4.6.2.

What is a project? ° Project is a unique process, consist of a set of coordinated and controlled activities with start and finish dates, undertaken to
achieve an objective confirming to specific requirements, including the constraints of time cost and resource. ° A project can be defined as a
temporary endeavour undertaken to create a unique product, service, or result. A project has a definite beginning and end, and can involve a single
person, a single organizational unit, or multiple organisational units. Typically, projects are multi-disciplinary, complex, dynamic, and are delivered
in a team environment. To senior management, a project must be important enough to justify setting up a special organisational unit outside the
routine organizational structure. A project can create: ° A product that can be either a component of another item or an end item in itself ° A
capability to perform a service (e.g. a business function that supports production) ° A result such as an outcome or document.

What is project management? Project management is “the application of management knowledge, skills, tools, and techniques to project
activities to meet the project requirements” (PMI, 2008). Project management is a distinct area of management that helps in handling projects. It
has three key features to distinguish it from other forms of management and they include: a project manager, the project team and the project
management system. The project management system comprises organization structure, information processing and decision making and the
procedures that facilitate integration of horizontal and vertical elements of the project organization. The project management system focuses on
integrated planning and control. ° Define and execute everything necessary to complete a complex system of tasks ° Achieve project end results
that might be unique and unfamiliar ° And do it - by target completion date - with constrained resources - with an organisation that is cross-
functional and newly-formed

Nature of projects ° Goal-oriented: aims at a specific end result or deliverables ° Somewhat unique: non-routine ° Time- and resource-constrained: temporary (has a
target completion date and target cost) ° Cross-functional: cross-disciplinary and cross-organisational ° Somewhat unfamiliar and risky: involves something new or
different ° Something is at stake ° Follows logical sequence or progression of phases or stages

Simply put, a project is a series of tasks that need to be completed in order to reach a specific outcome. A project can also be defined as a set of
inputs and outputs required to achieve a particular goal. Projects can range from simple to complex and can be managed by one person or a
hundred. Projects are often described and delegated by a manager or executive. They go over their expectations and goals and it's up to the team
to manage logistics and execute the project in a timely manner. Sometimes deadlines can be given or a time limitation. For good project
productivity, some teams break the project up into individual tasks so they can manage accountability and utilize team strengths.

How I Choose Projects 1. Step One: Gather Interesting Ideas. The first phase of choosing a project comes from cultivating interesting ideas. ... 2. Step Two: Incubate
Those Ideas. The most successful projects I did, usually didn't start out as perfect ideas. ... 3. Step Three: Uncover Flaws in Your Ideas. ... 4. Step Four: Commit to the
Project. ... 5. Choosing Differently

Characteristics of Project Plans A project plan can be considered to have five key characteristics that have to be managed: Scope: defines what will
be covered in a project. Resource: what can be used to meet the scope. Time: what tasks are to be undertaken and when. Quality: the spread or
deviation allowed from a desired standard. Risk: defines in advance what may happen to drive the plan off course, and what will be done to
recover the situation.

A project is typically defined as a set of interrelated activities having a specific beginning and ending, and leading to a specific objective. Probably
the most important concept in this definition is that a project is intended as a temporary endeavour, unlike ongoing, steady state operations.

A project is planned, organized and goal- oriented.

A project has a purpose, certain benefits that are targeted. In order to achieve the benefits, certain deliverables need to be produced during the
project. Both these goals and objectives should be defined early in the project.

Typology of projects A project can be classified with respect to the levels of complexity and uncertainty involved Figure 1-1: Typology of projects
(Nicholas & Steyn, 2008)

Three project objectives For every project, the common goal is to meet a three-dimensional target: complete the work for customer/client or end-
user in accordance with the budget, schedule and performance. These common project objectives are interrelated. A trade-off is required if one of
the objectives is increased or decreased. Figure 1-2
PROJECT, PROGRAM, PORTFOLIO A Project in general refers to a new endeavour with specific objective and varies so widely that it is very difficult
to precisely define it. A portfolio is a collection of projects or programs and other work to facilitate effective management such that strategic
business objectives can be met. A program is a group of related projects managed in a coordinated way to obtain benefits and control not available
from managing them individually.