1.1 The Purpose And Nature Of Business Flashcards
What is a good?
What is a service?
What is a need?
What is want?
Good= a physical product
Service= intangible item
Need= a necessity that without it, you will be affected negatively
Wants= a thing that without, you will not come to any harm
What is a customer?
What is a consumer?
What is a supplier?
What is a market?
CUSTOMER= the person who buys the product CONSUMER= the person who uses the product SUPPLIER= a business that sells products to another business MARKET= where buyers and sellers meet to exchange goods and services
What’s the definition of business?
An organisation that seeks to make profit.
Why might people start a business?
3 reasons.
To be their own boss To have flexible working hours To pursue an interest To earn more money They’ve identified a gap in the market They aren’t satisfied with their job They want to provide a service to help others
What is a raw material?
Raw material= wood,milk, petrol. Something that hasn’t been manufactured
What is meant by a business opportunity?
A business opportunity means the sale of any product/ service that will enable the the purchaser to begin a business
For example the internet will/ could open a business opportunity
State two threats to any new business
Competition with other companies Change in economy Legal changes Technological change Environmental expectation
What is production?
The action of making or manufacturing from components or raw materials, or the process of being manufactured
What is an entrepreneur?
Someone willing to take risks to achieve success
What is an enterprise?
The skill involved in wanting to start and run a business
What are characteristics of an entrepreneur?
Risk taker Innovative Independent Persistent Persistent Self confident Organised Good interpersonal skills Ability to learn from failures
What are the four factors of production?
Land
Labour
Capital
Enterprise
What does land mean in relation to the four factors of production?
The physical land and the site on which the business is allocated and other natural resources a business may use
Factory, ingredients
What does labour mean in relation to the factors of production?
The skills and numbers of employees employed by a business
Workers
What does capital mean in relation to the factors of production?
Equipment used to provide the goods or services such as machinery/ equipment
Machinery
What does enterprise mean in relation to the factors of production?
The skills of the people involved in the business to identify business opportunities and bring together resources to meet these opportunities
Inventors
What is opportunity cost and what is an example?
Opportunity cost is something that you may have to give up to get something else.
For example, time, money, effort
What are the 3 types of business and their function?
Info: when they all work together they become a chain of production
Primary= the physical/ raw material ( first stage of production) Secondary= making that into a product, they use primary resources and convert these into products Tertiary= selling a service (provide a service)
What are 4 basic business functions?
Sales and marketing, marketing and production, Human Resources, and finance accounting
What are the 4 different types of change in the business environment?
What do they mean?
TECHNOLOGICAL CHANGE=changes the way we shop
ECONOMIC CHANGE=eg.interest rates,inflammation and GDP
LEGAL CHANGE= new laws etc
ENVIRONMENTAL CHANGE= customers want to know how a products made
Keywords-
GOOD
A good is a physical item
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SERVICE
A service is a non-physical products
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CONSUMER
The person who ultimately uses the product
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CUSTOMER
Any person or organisation which buys or is supplied with a product by a business
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ENTREPRENEUR
Someone who takes on the risks of enterprise activity
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ENTREPRENEURSHIP
The activity of setting up a business or businesses taking on financial risks in the hope of profit
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ENTERPRISE
The process of identifying new business opportunities and taking advantage of them
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A SOCIAL ENTERPRISE
A business that is set up to help society rather than make a profit
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RESOURCES
A stock or supply of money, materials, staff and other assets that can be drown on by a person in order to function effectively
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INTERESTS
Money paid regularly at a particular rate for the use of money lent or for delaying the repayment of debt
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INTEREST RATES
A value which shows the cost of borrowing money or the reward given for saving money
Keywords
INFLATION
Sustained increase in the general price level of good and services in an economy over a period of time
keywords
GDP
gross domestic production
-measure all income earned in a countries economy per year
