Topic 1 - Business in the real world (1. the purpose and nature of a business) Flashcards
why do businesses exist
to supply goods or provide services
what are goods
physical items
what are services
actions that are performed by other people to aid a customer (intangible).
what is a need
something a human cannot live without, water, food
what is a want
something that is not needed in order for a human to survive
Reasons a business is set up
- when someone starts making a good or service they think customers will want
- to distribute goods
- to benefit other people
- to gain a profit
- gap in the market
- business opportunity they want to fulfil
state the 3 sectors of economy
primary
secondary
tertiary
the sectors of the economy tells you what a business provides depending on the sector it fits into
what is the primary sector
produces raw materials
any natural resources the a made to provides goods or services
what is the secondary sector
manufactures goods
building and construction
what is the tertiary sector
provides services
sells finished goods
can businesses be apart of all three sectors
yes
what is an enterprise
a business or organisation or personal qualities of an entrepreneur meaning they can see and take advantage of possible business opportunities
what is an entrepreneur
takes risks pf enterprise activity
why might someone want to become and entrepreneur
financial reasons - if a business is successful it will gain profit
identifying a gap in the market
want the independence of being their own boss
wants to follow an interest
dissatisfied with their current job
qualities of an entrepreneur
hardworking
organised
innovative
willingness to take risks
what are the 4 factors of production
land labour capital enterprise
why are the 4 factors of production needed
these are the resources needed to make products
what is land
all earth natural resources
renewable resources, non- renewable resources
what is labour
the work done by people who contribute to the end product
what is capital
the equipment, factories and schools that help to produce goods or services
what is enterprise
refers to the people that takes the risks and creates things
what is opportunity cost
opportunity cost is the benefit that is sacrificed in order to do something else
