Revision Questions

1. Define factors of production. This is a term to describe the inputs that are used in the production of goods. For example, this can include land and labour. 2. What are the factors of production? Explain each. Give examples of each. * Land: Mainly natural resources * Labour: Human resources, the actual people that are working to produce something * Capital: All man-made resources, the money that is generated * Enterprise: The result of combining all of the above. 3. What are the four functional departments of a business? Explain each. * Production: Determines the work of raw materials into finished products, ready to distribute to costumers. * Finance: Managing organisations money. For example, the recording of money for taxes. * Marketing: Satisfy costumers wants in order to sell their product. *Personnel: The people that work in your company for you. 4. Explain why it is important for all four business functions to work closely together. Because if all of the four main areas of business can work together, the production will increase because of the good organisation and relationship inside the company, and this will be seen externally be increasing the sales and making the company more important and generate more money. 4. How many business sectors are there? What are they? Define each and give one example for each. There are four business sectors: Primary: This is raw materials (taking down trees to take wood) Secondary: Creating a product from raw materials (making a table out of the wood) Tertiary: This is more developed, this are mainly services (schools, big firms such as Google that has offices in an specific country, a cinema)

 Quaternary: This is very technological because it involves research in order to produce products from natural resources (A company might research how to make a table with less quality wood)

5. Explain how the number of people employed in each sector differs between less developed, developing and developed nations. Less developed: Here the number of people employed will be mainly in the first sector. This is because people dont have the education or preparation to make something that requires studying. People will be also aiming to the secondary sector for the same reason. There will be almost no people in the tertiary and quaternary sectors, and since the country is undeveloped, they might not even have these last two sectors. Developing: Since the country is starting to develop, the first two sectors (Primary and Secondary) will become less important, because the country is aiming to services now. The number of people working in the first two sectors will be lower, because most of them will be migrating to the tertiary sector, and now this will have the majority of workers. For the quaternary sector, the demand will remain low since the country in just starting to evolve. Developed: In the case of developed countries, the first two sectors will be almost empty, since everyone has the opportunity to study and work in an office or something like that. The tertiary sector will have the biggest amount of workers, but the quaternary sector will now have a lot of people too because employees have the opportunity to prepare themselves in order to become more important and earn more money. 7.What is the difference between public and private sector organisations? The public sector organisations are ran by the government, this is why they are called public. For example, this can be the police or public schools. In the case of private organisations, these are run by a specific group or person, which is not controlled by the state whatsoever. For example, Apple or Facebook. 8. Define, mixed, free-market and command economies. * Mixed economies: These are economies that combine public and private companies.

* Free Market economies: These are economies that are not ran by the government and offer the costumers to make their transactions freely, and avoid subsidies and in some case taxes. * Command economies: These are economies in which price, production and income is determined by the government.

9. Type of Business

Definition

Advantages (Give 3) Taking decisions is easier All profits are for one Power over everything Easier to think of ideas Low risk of failure More money to improve the company Low risk of failure Always success of the company No worries when taking decisions

Sole trader A person that runs a company by their own.

Disadvantages (Give 3) Who is this business structure suitable for? A person that No help in decision-making likes to work by High risk of themselves. failure Responsibility is not shared Disagreement Might be slower to work Problems with money Two companies with the same idea that want to become bigger. A company controlled by an entrepreneur, so they dont lose money

Partnership A business that is controlled by two or more people or organizations. Private limited company

A private company with limited risk, where shareholders can lose money but the company cant.

Easy to lose ones money Shareholder might handle their shares badly Bad reputation

Public limited company

A private company that sells its shares in the stock market.

Easy to make money People will know about it Will have more

There might be fraud when buying the shares Price will go down and the

A company that wants to expand their reputation and want to go public

costumers

Public sector enterprise

A company that is ran by the government.

No risk Government will pay everything Easy to generate money from

Non-profit and nongovernment organisations

A company that doesnt generate profit .

No risk or little risk You are helping other people You will be increasing your reputation

Publicprivate partnerships

The involvement of a private company in a governmental project.

Make money faster Might become more important Government has no risk

company loses money Market collapse Government might be unethical No decisionmaking People might not like the government and will seek for private alternatives Can stop being rentable People might find something better You might not have enough money to support your company Disagreement Government might be unethical People might not like the idea and stop supporting the project

A school or a university

Charities

Private companies that might want to have a better relationship with the government.