ENTREPRENEURSHIP- The capacity and
willingness to develop, organize, and manage a
business venture along with any of its risks in order
to make a profit.
ENTREPRENEURS- They try to identify the needs
of marketplace and to meet those needs by
supplying a service or product.
ENTREPRENEURS AND EMPLOYEES
• An entrepreneur assumes risks.
• Employees are people who work for someone
else.
• Both may make decision, but only the
entrepreneur is directly affected by the
consequences of those decisions.
Entrepreneurs and Inventors
• According to Hirsch et.al (2008), there is a great
confusion about the nature of an entrepreneur
versus an inventor.
• Inventors are people who create something for
the first time. They are highly driven individuals
motivated by their own work and personal
ideas. They are well-educated, with college or,
most often, post-graduate degree education,
and occupational experiences that contribute to
creative development.
TYPES OF ENTREPRENEURIAL BUSINESS
1. Manufacturing
- Apparel and other textile products
- Chemicals and related products
- Food products
- Printing and Publishing
- Stone, clay, and glass products
2. Wholesaling
- Apparel
- Groceries and related products
- Machinery, equipment, supplies
- Lumber, construction materials
- Hardware, plumbing, heating equipment
3. Retailing
- Grocery stores
- Hardware stores
- Shoe stores
- Gift, novelty, and souvenir stores
- Furniture stores
4. Service
- Appliance repair, automotive repair
- Babysitting
- Bookkeeping
- Dance instruction
- Tutoring
CHARACTERISTICS OF A SUCCESSFUL
ENTREPRENEUR
• Independent
• Self-confident
• Have determination and perseverance
• Goal-oriented
• Creative
• Able to act quickly
• Know what they want, and are able to focus on
achieving it
• Have a need to achieve and set high standards
for themselves
ADVANTAGES OF ENTREPRENEURSHIP
• Entrepreneurs are their own bosses
• Entrepreneurs can choose a business that
interests them
• Entrepreneurs can be creative
• Entrepreneurs can make lots of money
DISADVANTAGES OF ENTREPRENEURSHIP
• Entrepreneurship is risky
• Entrepreneurs face uncertain and irregular
incomes
• Entrepreneurs work long hours
• Entrepreneurs must make all decisions by
themselves
ENTREPRENEURIAL PROCESS- the process of
pursuing a new venture Hirsh et.al (2008)
ENTREPRENEURIAL PROCESS
1. Identification and evaluation of the opportunity
2. Development of the business plan
3. Determination of the required resources
4. Management of the resulting enterprise
CONTEMPORARY ECONOMIC ISSUES
 INVESTMENT
- Investment is the use of savings to become
future income.
- A product that people buy with the hope that
they will be beneficial or will generate income
in the future.
- More specifically refers to the use of funds to
acquire capital goods (items that are
necessary to produce other goods and
services)
- Vital for economic development and growth.
- Investment is the value of fixed capital
assets (plus stocks) produced in an economy
over a period of time – investment refers to
 the creation of capital goods. Investment
spending is an injection into the circular flow
of income.
- Long-term investment – ex: buying a
property or engaging in real estate.
- Short-term investment – ex: savings and
time deposits.
Different Kinds of Investments
• Direct Investments
1. Business Investments- Buying a small
business may be the most demanding kind
of investment. Investors may be required
to work hard to earn an acceptable return.
2. Real Estate- People invest in real estate
when they buy homes, land, or rental
properties.
• Indirect Investments
1. Savings Account- Savings account is a
common kind of investment. Funds
deposited in a savings account at a bank,
credit union, or savings institutions earn
interest at a specified annual rate.
2. Bonds- A form of long-term investment
issued by a corporation or government
where the purchaser becomes a creditor of
the company. When you invest in bonds,
you're lending money to a company or
government. In return, you get regular
interest payments, called coupon
payments. If you hold the bond until
maturity. The date on which a debt
or investment and all outstanding interest
payments must be paid in full. , you get
back the face value.
3. Stocks- represent ownership in a publicly-
traded company. When you buy a
company's stock, you become part-owner
of that company. For example, if a
company has 100,000 shares and you buy
1,000 of them, you own 1% of it. Owning
stocks allows you to earn more from the
company's growth and gives you
shareholder voting rights.
Common Stocks- represents shares of
ownership in a company.
Preferred stocks- a type of corporate
security that has features of both bonds
and common
4. Mutual Funds- These are companies that
invest in a variety of securities and sell
shares in those securities to all types of
investors
5. Life Insurance- Life insurance companies
sell insurance policies that also act as a
savings account
RENT
• A payment of factor of production in excess of
its opportunity cost.
• It is what is paid to any input in more than you
would have had to pay it.
Types of rent
1. Inframarginal rent- “Infra” means below or
under. “Marginal” means at the margin or
the end or last. It is quasi rent earned by a
perfectly competitive firm in the short run
(Davis 1997)
 The quasi rent earned by a perfectly
competitive firm in the short run. If price
equals marginal cost, then it earns nothing
on the marginal unit, but if marginal cost
increases with output due to a fixed factor,
then price exceeds marginal cost
for inframarginal units.
2. Pure economic rent- Any payment made to
a factor of production or anything that is
fixed in supply
- Pure economic rent is a surplus amount
earned by various sources (e.g. land, capital
and labor) by behavior as per standards of
its present use. in the market is exactly
inelastic in long run. It is the price used to
pay for land and other natural resources
which are totally fixed in supply.
3. Quasi rent- In a perfect competition, firms
sell their product for just what it costs to
produce it, so they earn no profit.
4. Monopoly rent- They are payments made to
a monopolist that are more than the
minimum that the firm would accept.
- Monopoly rent refers to the situation wherein
a monopoly producer lacks competition and
thus can sell its goods and services at a
price far above what the otherwise
competitive market price would be; at the
expense of consumers.
Unemployment- when a person, who is actively
searching for employment, is unable to find work.
Often used as a measure of the health of the
economy.
MINIMUM WAGE- The lowest salary that
employers can legally pay their workers. Governed
by the Labor Code of the Philippines and is
implemented by the Department of Labor and
Employment.
Types of unemployment
• Frictional Unemployment- It arises when a
person is in-between jobs.
• Cyclical Unemployment- Rises during
recessions and declines during periods of
economic growth.
• Structural Unemployment- It comes about
through technological advancements, when
people lose their jobs because their skills are
already outdated.
• Cyclical unemployment is a type
of unemployment that occurs when there is not
enough aggregate demand in the economy to
provide jobs for everyone who wants to work. In
an economy, demand for most goods falls, less
production is needed, and less workers are
needed.
• Structural unemployment refers to a mismatch
between the jobs available and the skill levels of
the unemployed.
Taxes
o Taxes are considered inflows for the
government and outflows for firms.
o Businesses apply either a percentage tax on
gross receipts (3%) or value added (12%).
COMPETITION- A rivalry in which every seller tries
to get what other sellers are seeking at the same
time like sales, profit, and market share by offering
the best practicable combination of price, quality,
and service
COMPETITOR- Any person or entity which is a
rival of another. A company in the same industry or
a similar industry which offers a similar product or
service.
Advantages Of Competition
• Competition makes your customer service
better.
• Competition fosters innovation.
• Competition helps identify your strengths
and weaknesses.
• Competition is good for consumers.
• Competition reminds you to focus on your
key customers.
• Competition provides the opportunity to
serve.
• Competition makes way for creative
thinking.
• Competition helps identify potential threats
to your business.
• Competition stops complacency.
CUSTOMER- An individual or business that
purchases the goods or services produced by a
business. Businesses often follow the adage “the
customer is always right” because happy
customers are expected to continue buying goods
and services from companies that meet their
needs.
CUSTOMER AND CONSUMER
• CUSTOMERS are defined by their purchase
of goods, or their contracting for services,
while the CONSUMER is the end user.
MARKET SEGMENTATION
• Categorizing your customers according to
demographic and geographic groups.
• This is done to meet the demands of
different types of consumers.
• Demographics – describe the kind of
customers you have in terms of gender,
age, and income.
• Geographic segments – refers to
consumers belonging to a certain place.
They can be classified as urban or rural
areas, western, eastern, southern, and
northern parts of a certain country or region,
and it may also refer to different provinces
or cities.
SUPPLIERS AND SUBSTITUTES
• Suppliers – are the entities who supply
goods and services.
• Substitutes – are products that can be used
instead of another.
SWOT Analysis
• A tool for business analysis which every
organization needs to get through greater
heights of success.
• Strength, Weaknesses, Opportunities, and
Threats
• Strength – the positive internal
characteristics that the organization can
exploit to achieve its strategic performance
goals.
• Weaknesses – internal characteristics that
might inhibit the organization’s performance.
• Opportunities – characteristics of the
external environment that have the potential
to help the organization achieve or exceed
its strategic goals.
 • Threats – characteristics of the external
environment that may prevent the
organization from achieving its strategic
goals.

Strengths
- Advantages
- Unique and low-cost resources
- Factors that mean that you “get the sale”
Weakness
- Disadvantages
- Limitations
- Need for improvement
- Factors that cause loss of your sales
Opportunities
- Chances to improve performance
- Good opportunities that you can spot
Threats
- External troubles for the business
- Obstacles that you face
- Activities your competitors are doing