Unit 1.1 - the nature of business activity/Unit 1.2 providing goods and services

Question 1

Explain the difference between a need and a want.

Answer 1

A need is something you require to survive whereas a want is something you desire to have.

Question 2

Explain the difference between goods and services.

Answer 2

A good is a product that can be seen, touched and handled (tangible) whereas a service are provided for individuals or businesses (intangible), they are offered to or for their customers.

Question 3

Explain the difference between consumer and producer goods.

Answer 3

Consumer goods are used by the final user (people) whereas producer goods are products bought by a company and used to produce other goods and services.

Question 4

Explain the difference between durable and non durable goods.

Answer 4

Durable goods that last a long time so not bought often whereas non durable goods have a lifespan of less than three years and can be immediately consumed.

Question 5

Explain the difference between personal and commercial services.

Answer 5

Personal services are provided for individuals whereas commercial services are provided mainly to businesses.

Question 6

Explain the difference between the public and private sector.

Answer 6

Private sector is owned by individuals whereas the public sector is owned by the government.

Question 7

Name and explain the factors of production (factor inputs) (4)

Answer 7

Capital - machinery. equipment etc
Enterprise - ideas or organising of resources
Labour - workers with the right skills, qualifications and experience
Land - raw materials such as coal or wood or a site on which to build the factory shop or office