YR 9 EXAM REVISION ON TERMS

Question 1

what is production?

Answer 1

Production is the making of goods and offering of services in order to satisfy human wants and needs.

Question 2

what are the factors of production?

Answer 2

Land
Labour
Capital
Enterprise

Question 3

what is land and what the reward is?

Answer 3

This is also called a natural resource used in production.

Includes what is beneath the earth (land), what grows naturally on it, what is found in it, the sea, atmosphere, mountains, valleys, fish, plants etc.
The reward is rent.

Question 4

what is labour and what are the three types and the reward?

Answer 4

Human resources used in production. There are three types:

Skilled – Highly trained workers.
Semi-skilled – Workers with little training such as stewards etc.
Unskilled – Workers who do not need training.
The rewards are wages/salaries.

Question 5

what is capital and what is the reward?

Answer 5

Human-made items used in production of goods and services.
Examples include buildings, office desks, machineries and motor vehicles.
The reward is interest.

Question 6

who is an entrepreneur and what are their reward?

Answer 6

He/She is the provider of capital.
He/She is the risk bearer.
He/She brings together the three other factors of production.
His/Her reward is profit/loss.

Question 7

what is a scale of preference?

Answer 7

the list of wants or needs that a person writes or comes up with in order of their importance.

Question 8

what is scarcity?

Answer 8

Scarcity means “limited in supply”.
The resources we have are not enough to satisfy all our unlimited wants and
needs.

Question 9

what is opportunity cost?

Answer 9

It is measured in terms of the next best alternative given up when making a decision. Every choice made has an opportunity cost.

Question 10

what are the types of production?

Answer 10

TYPES/STAGES OF PRODUCTION

Primary
Secondary
Tertiary

Question 11

primary production?

Answer 11

Firms that extract food and raw materials from the earth e.g. farming, fishing, mining, quarrying, horticulture etc.

Question 12

secondary production?

Answer 12

Firms that:

Manufacture – changing raw materials to finished or consumable items.

Construct buildings, roads and bridges.

Question 13

tertiary production?

Answer 13

Provision of services to The general public and other firms e.g. retail shops, doctors, dentists, schools, hairdressers, advertising agencies, lawyers, financial advisers, insurance companies and banks.

Question 14

what are other names that production possibility curve is also known as.

Answer 14

Production Possibility Curve is also known as:

Production Possibility Boundary;
Production Possibility Frontier; or
Product Transformation Curve.
Production Possibility Curve – Meaning

Question 15

what is division of labor?

Answer 15

This when production process is broken down a number of tasks, with each task performed by a separate person or group of persons.

Question 16

advantages of division of labor to workers?

Answer 16

Advantages for Workers:
Become skilled: workers can get skilled and experienced in a specific task which will help their future job prospects
Better future job prospects: because of the skill and training they acquire, workers will, in the future, be able to get better jobs
Giving each employee tasks that best suit her skills

Question 17

disadvantages of division of labor to workers?

Answer 17

Disadvantages to workers
Boredom: Performing the same task over and over again may lead to boredom for the workers.
Reduced flexibility (specialist teachers
)
Lack of mobility: Due to specialisation workers might find it difficult to switch between occupations.

Question 18

advantages to firms from division of labor?

Answer 18

Advantages to firms

Increased productivity: when people specialise in particular tasks, the total output will increase.

Increased quality of products: because workers work on tasks they are best suited for, the quality of the final output will be high.

Low costs: workers only need to be trained in the tasks they specialise in and not the entire process;

Faster: when everyone focuses on a particular task and there is no need for workers to shift from one task to another, the production will speed up

Increased profits: lower costs and increased productivity will help boost profits.

Question 19

Disadvantages to firms from division of labor?

Answer 19

Disadvantages o firms

Increased dependency: The production may come to a halt if one or more workers doing a specific task is absent.
Quality may suffer if workers become bored by the lack of variety in their jobs

Question 20

Advantages to the economy from division of labor?

Answer 20

Advantages to the economy
Better utilisation of human resources in the economy as workers do the job they’re best at, helping the economy achieve its maximum output.

Inventions arise: as workers become skilled in particular areas, they can innovate and invent new methods and products in that field.

Question 21

disadvantages to the economy from division of labor?

Answer 21

Disadvantages to the economy
Labour immobility: occupational immobility may arise because workers can only specialise in a specific field.
Reduces the creative instinct of the labour force in the long-run as they are only able to do a single task repetitively and the previous skills they acquired die out.

Question 22

What is Added Value?

Answer 22

It is the difference between what a business pays its suppliers, and the price that it is able to charge for the product/service.
Businesses can add value to their product/service by doing something with the raw materials and providing something ‘different’.

Question 23

SOURCES OF ADDED VALUE?

Answer 23

SOURCES OF ADDED VALUE
Quality 
Design 
Unique selling point
Speed of service
Branding 
Convenience

Question 24

IMPORTANCE OF ADDED VALUE?

Answer 24

Every business must add value to survive and be
successful

The higher the added value, the more likely it is that a
business will survive, grow and be successful in the long
term

Benefits to a business of adding value: A business
can differentiate itself from its competitors

A business can save the cost on advertising and other
promotional activities once it has created a perception of
high quality and brand loyalty among its customers.

Question 25

WHO IS AN ENTREPRENEUR?

Answer 25

An entrepreneur is an individual who
organizes and operates a business or
businesses, taking on financial risk to do so.

Question 26

What are the qualities of a

successful entrepreneur?

Answer 26

Self motivation-passionate about their ideas

Positive attitude-Not discouraged by initial failure

Risk taker-Be ready to go through uncertainties

Innovative

Dependable-

-excellent leadership qualities

determined

Resourceful

effective Communicators

Achievement oriented

Self confident

Question 27

Reasons for Business

failure?

Answer 27

Lack of finance

Poor choice of location

Poor management

Poor human resource relations

Poor business planning

lack of demand

increased competition

Becomes insolvent

Question 28

why governments
support business start-ups/small
businesses?

Answer 28

To increase employment

Increase economic growth

Increased competition

Help them survive

Cater for local demands

Question 29

what are contents of a business class?

Answer 29

executive summary
company description
product or service
market analysis
location of business
finance
cashflow
forecast profit

Question 30

Industrialization?

Answer 30

Industrialization is the process by which an economy is transformed from a primarily agricultural one to one based on the manufacturing of goods

Question 31

de-industrialization?

Answer 31

the growing importance of the tertiary sector and the reduced importance of the secondary sector.

Question 32

whats a mixed economy?

Answer 32

An economy where the resources are owned and controlled by both the private and public sectors.

Question 33

types of private sector firms

Answer 33

sole trader
partnerships
limited companies
franchise,joint ventures
Social enterprise

Question 34

types of public sector firms

Answer 34

government departments
public corporations
nationalized industries

Question 35

what is a business plan?

Answer 35

it is a document that contains the businesses aims/objectives and important details about the operations,finance and owners of the business.

Question 36

methods of measuring business size?

Answer 36

Methods of measuring business size

Sales turnover

Number of employees

Capital employed

Market share

Question 37

sales turnover?

Answer 37

Is the money that you get from the
sale of products

The costs of sales have not been
deducted from this

Using this method to compare
businesses in different industries
can be less effective

This can be a good way to compare
the business in the same industry

Question 38

capital employed?

Answer 38

Capital employed is the amount of
money invested in a business.

The more money invested, the
larger the business

Question 39

market share?

Answer 39

It is the percentage of an industry or market’s
total sales that is earned by a particular
company (or brand / product) over a specified
time period

Question 40

Why some businesses stay small

Answer 40

Type of industry the business is in
-Industries offering personal service or
specialized products. They cannot grow bigger because they will lose the personal service demanded by customers.

Market size
-If the number of customers a business is selling to is too small, the business cannot expand.

Owners objectives
-Owners might want to keep a personal touch with staff and customers