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101 Things I Learned (TM) in Business School
By Preis, Michael W.
Grand Central PublishingCopyright © 2010 Preis, Michael W.
All right reserved.
Business is the exchange of entities to which values have been assigned.
In business transactions, the values assigned to goods, services, or money may be economic, emotional, or both. A business transaction works because each party assigns a higher value to what it receives than what it provides. A customer who buys a sweater for $50 values the sweater more than the $50; likewise, the seller values the $50 more than the sweater.
Value may be assigned on the basis of anticipated future value instead of current value. For example, one might “overpay” for an ice cream machine because of an expectation that it will generate future income. In this sense, business is sometimes defined as the exchange of current value for future value.
Excerpted from 101 Things I Learned (TM) in Business School by Preis, Michael W. Copyright © 2010 by Preis, Michael W.. Excerpted by permission.
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