Business Activity

Question 1

Need

Answer 1

A need is a good or service essential for living.

Question 2

Want

Answer 2

A want is a good or service which people would like to have, but which is not essential for living. People’s wants are unlimited.

Question 3

Economic Problem

Answer 3

There exist umlimited wants but limited resources to produce the goods and services to satisfy those wants. This creates scarcity.

Question 4

4 Factor Of Production

Answer 4

Land
Labour
Capital
Enterprise

Question 5

Scarcity

Answer 5

Scarcity is the lack of suffienient products to fulfil the total wants of the population.

Question 6

Opportunity Cost

Answer 6

Opportunity cost is the next best alternative given up by choosing another item.

Question 7

Specialisation

Answer 7

Specialisation occurs when people and businesses concentrate on what they are best at.

Question 8

Division Of labour

Answer 8

Division Of labour is when the production process is split up into different tasks and each worker performs one of these tasks. it is a form of specialisation.

Question 9

Businesses

Answer 9

Businesses combine factors of production to make products (goods and services) which satisfy people’s wants.

Question 10

Added Value

Answer 10

Added Value is the difference between the selling prices of a product and the cost of bought-in materials and components.