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N5 > Business - Understanding business > Flashcards

Business - Understanding business Flashcards

1
Q

What is the role of a business?

A

buying and selling goods, providing a service and making money

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2
Q

What is a business?

A

An enterprising entity engaged in industrial. professional and commercial activities

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3
Q

What does every business have?

A

Aims and objectives

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4
Q

Define Needs and give an example

A

Needs are required for survival
E.g food

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5
Q

Define wants and give an example

A

Wants are non-essential, luxury, not important for survival

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6
Q

Define disposable income

A

The money left over and available to spend after you have paid your monthly commitments (rent,tax)

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7
Q

Why are services bought

A

Cannot do it yourself, its illegal without a licence, not qualified, too dangerous

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8
Q

Define Goods

A

Tangible products

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9
Q

Define services

A

A non-tangible thing that is done for you

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10
Q

Give examples of a Durable and Non-durable good

A

Durable - house, bicycle
Non-durable - food, cosmetics

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11
Q

Define durable

A

Long lasting

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12
Q

Define tangible

A

I can see and touch

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13
Q

What are the Factors of Production

A

Capital, enterprise, land and labour

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14
Q

What is Capital

A

The man-made tools, machinery and the equipment businesses use to operate e.g tractor,oven,building

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15
Q

What is enterprise

A

The business ideas that the entrepreneur or owner uses to best combine the other factors of production to make a profit and achieve their aims e.g ingredients,ovens,staff

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16
Q

What is land

A

The natural resources that businesses use (the raw materials) e.g the plot of land, coal, forestry,wood,water etc

17
Q

What is Labour

A

The work force or employees of a business e.g joiner, farmer, teacher, assistant etc

18
Q

What is Wealth Creation?

A

The creation of wealth is when each sector passes on a product adding value

19
Q

How can a business Add Value to a product?

A

Convenience, branding, quality, design and unique selling point.

20
Q

The Business Cycle - clockwise =

A

increasing demand, growth and inflation

21
Q

The business cycle - anticlockwise =

A

falling demand, closing businesses and recession

22
Q

inflation definition

A

Prices rise because demand is high and supply is low

22
Q

recession definition

A

when demand is low, leading to job losses and businesses closing

23
Q

What are the 3 Sectors of Industry?

A

primary, secondary and tertiary

24
Q

What is primary

A

The raw materials from forestry, mining, fishing, farming etc

25
Q

what is secondary?

A

Secondary makes the products from raw materials

26
Q

What is tertiary?

A

Services / selling products and raw materials

27
Q

What are 4 benefits of good Customer Satisfaction?

A

Customer loyalty, competitive advantage, attract new customers, boost sales

28
Q

What is an entrepreneur?

A

A business owner / someone with an idea and made it a business

29
Q

What is the simplified business cycle

A

Businesses produce goods + services to meet customers wants, Customers buy goods + services to satisfy their wants, Wealth is created for businesses and their owners, Customers have money to spend from their wages and want other goods + services

30
Q

What are the first 3 steps in the business cycle?

A
  1. People have needs and wants
  2. Businesses are created to meet these needs and wants
  3. The businesses employ people to produce the goods and services
31
Q

What are the 4th, 5th and 6th steps in the business cycle?

A
  1. Customers buy the goods
    and services to meet their needs and wants
  2. Wealth is created for businesses and the owners
    6.Employees are paid a wage
32
Q

What are the last 2 steps of the business cycle?

A
  1. Customer have money from their wage to spend on existing goods and services
  2. Existing businesses grow to meet customer demands and new businesses are created which employ more people

N5 (9 decks)

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