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Business: How organizations create value
Every business is the same equation: create value for someone, capture a fair share of it, repeat.
Value creation and capture
Customers pay when value delivered exceeds price paid; the firm keeps what price exceeds cost. Both halves of that gap must be positive for the business to exist.
Value \u2192 Price ≥ CostOwnership and risk
Sole proprietorship, partnership, corporation differ in liability, taxation and control. Form follows risk: the more the venture can hurt, the more the corporate shield matters.
What this course teaches
Nine units cover ownership and stakeholders, ethics, economics, management, human resources, marketing, accounting and finance, operations, and entrepreneurship.
Flashcard
π = TR − TC
Profit identity
Total revenue minus total cost. Simple, and behind every strategy conversation ever held.
Check your understanding
A firm sells a product customers value highly but costs run above willingness to pay. The first fix: