Purpose and nature of businesses Flashcards
What is the purpose of a business?
To provide goods/services
What is a good?
Something tangible like a pen
What is a service?
Something intangible or what someone else does for you like a bus journey.
What is a want?
Something you would like to have like a designer watch
What is a need?
Something you must have to survive like water.
Why do people start a business? (list a few factors)
To be their own boss, To keep all the profits, Interest or hobby, Gap in the market, Flexible working hours.
What is an entrepreneur?
Someone with a business idea who goes on to start the business.
What are the 4 factors of production?
Land, Labour, Capital, Enterprise.
What is land?
Where the business is located
What is labour?
Employees employed by the business
What is capital?
Equipment uses to provide the good or the service.
What is enterprise?
The skills of people to identify business opportunities and bring together resources to meet these needs.
What is opportunity cost?
The thing you give up, i.e you could have salad or pizza for lunch, whatever you don’t choose is the opportunity cost.
What are the three business sectors?
Primary, Secondary, Tertiary
What are the 4 main business functions?
Marketing, Operations, Human Resources and Finance
