Unit 1 - Understanding business Flashcards
What is the role of a business?
- Provide goods and services
- Fulfil peoples needs and wants
Describe a durable good
- Items which we use again and last for a long time
Describe a non durable good
- Items we normally use once or are used quickly
State the 4 factors of production
- Capital
- Enterprise
- Land
- Labour
Describe the factors of production
- (Capital) - the man made resources a business owns
- (Enterprise) - The will of the owner to make the business successful.
- (Land) - The natural resources a business uses
- (Labour) - the human resources required by a business.
Identify some skills of an entrepreneur
- Good communication skills
- Effective decision making skills
- effective leadership skills
State some qualities of an entrepreneur
- Hardworking
- Determination
- Enterprising
Identify the 3 sectors of Industry
- Primary
- Secondary
- Tertiary
Describe the 3 sectors of industry
- (primary) - Businesses grow or extract natural resources from the ground
- (Secondary - Businesses manufacture their products
- (Tertiary) - Businesses provide services
State the 3 sectors of the Economy
- Private Sector
- Public Sector
- Third Sector
Describe the 3 sectors of the Economy
- (Private) - Business owned and controlled by private individuals
- (Public) - Businesses owned and controlled by the government
- (Third Sector) - Businesses set up to help a particular cause by raising money through donations
What are the 3 types of Private Sector Organisations
- Sole Traders
- Partnerships
- Private Ltd Companies
Describe the benefits of a sole trader
- Controlled by one person
- Easy and cheap to set up
- Owner keeps all profits
Describe the disadvantages of a sole trader
- No one to share decision making with
- Hard to take time off
- unlimited liability
Describe the advantages of a partnership
- Workload can be shared
- Decision making is shared
- Easier to take time off
Describe the disadvantages of a partnership
- Partners have unlimited liability
- There may be arguments between partners
What is limited liability?
- Investors only lose what the invest into the business if they get into debt
Identify some external factors that could impact a business
- Political
- Economic
- Social
- Technological
- Environmental
State some internal factors that could impact a business
- Finance
- Human Resources
- current technology
What is a Stakeholder?
- An individual or a group of people who have interest in the success of an organisation
