private and public sector

Question 1

What are the 8 aims of the private sector?

Answer 1

• survival
• profit maximisation
• sales maximisation
• market share
• cost efficiency
• employee welfare
• customer satisfaction
• social objectives (positive impact on society / environment)

Question 2

what are the 3 features of public sector organizations.

Answer 2

• non-excludability
• non-rivalry
• merit goods

Question 3

what is non-excudability

Answer 3

the goods and services are not simply for those who have paid for them but for any person who needs and/or qualifies for them (e.g. bus passes for over 60s even if they have not paid into the tax system)

Question 4

what is non-rivalry?

Answer 4

one customer using the product or service does not stop other consumers using the same product / service (e.g. all over-60s have a right to a bus pass -
there is no maximum number)

Question 5

what are merit goods?

Answer 5

a commodity or service, such as education, that is regarded by society or government as deserving public finance (e.g. education)

Question 6

what are 4 aims of the public sector?

Answer 6

• transformation of the economy
• balanced regional development (equality)
• improve standards of living with services
• safety and security (army, police, fire service)