Business Activity Flashcards
What are goods?
Goods are tangible objects that can be used or stored.
What is a service?
A service is an intangible action that cannot be stored.
What is business activity?
Business Activity is the process of producing goods and services to satisfy customer demand.
What is a want?
Things that people would like to have but can survive without.
What is a need?
Things required to survive.
What are factors of production?
Resources that businesses need to produce their product.
What are THE factors of production?
~Land
~Labour
~Capital
~Enterprise
What is opportunity cost?
When something is given up in order to do something else.
What is the equation for opportunity cost?
Scarcity + Choice = Opportunity Cost
What is specialisation?
When a person or organisation concentrates on a task at which they are best at.
What are the advantages of specialisation?
~Increasing efficiency
~Faster Production
~Skill Development
~Quicker to train labours
What are the disadvantages of specialisation?
~Decrease in quality of work
~Loss of interest
What is scarcity?
The lack of something in a given area.
What are the three types of product?
~Consumer Goods
~Capital Goods
~Consumer Services
What is added value?
The difference between what a business pays its suppliers and the price that is able to charge for the product or service.
