Define needs, and explain how they are different from wants.
Define opportunity cost.
Name the three economic sectors used to classify businesses.
Define private sector and public sector.
Define entrepreneur.
Name three methods used to measure the size of a business.
State what is meant by a business having liquidity problems.
A furniture maker buys wood costing \$90 and uses it to make a table. The table is sold for \$250.
(a) Explain what is meant by added value.
(b) Calculate the value added by the furniture maker. Show your working.
For each business below, state whether it is part of the primary, secondary or tertiary sector.
(a) A farm that grows and harvests wheat
(b) A factory that bakes the wheat into bread
(c) A supermarket that sells the bread to customers
(d) A company that mines iron ore
For each organisation below, state whether it is part of the private sector or the public sector.
(a) A privately owned clothing shop
(b) A government-run public hospital
(c) A family-owned bakery
(d) A state (government) school
A factory worker spends every day fitting the same part onto every car made in the factory. This is an example of specialisation.
(a) State one benefit of this specialisation for the worker.
(b) State one drawback of this specialisation for the worker.
A clothing company wants to add more value to its T-shirts without increasing the cost of materials very much. Identify two ways it could do this.
(a) Way 1:
(b) Way 2:
State whether each situation below is an example of internal growth or external growth.
(a) A bakery uses its own profits to open a second shop in another town.
(b) A bakery buys an existing rival bakery business.
A business owner says: “My business must be large, because it makes a big profit.” Explain why this statement is incorrect.
In Country A, the percentage of workers employed in the primary sector has fallen sharply over the last 30 years, while the percentage employed in the tertiary sector has risen. Explain two reasons why this change might have happened.
Reason 1:
Reason 2:
Amara is planning to start her own business.
(a) State three characteristics that would help Amara succeed as an entrepreneur.
(b) State two things that would typically be included in Amara’s business plan.
(c) Explain two ways the business plan would help Amara.
(a) Explain two reasons why governments support new business start-ups.
(b) Describe one way a government could provide this support.
A market trader buys apples from a farm and sells them to customers in the local market.
(a) Explain the purpose of business activity, using this example.
(b) Explain two ways this business could add value to the apples it sells. Use examples to support your answer.
Do you think specialisation is always beneficial for a business? Justify your answer.
A successful bakery business is considering expanding.
(a) Explain two reasons why the owners might want to expand the bakery.
(b) Explain one problem the bakery might face as a result of this growth, and how it could be reduced.
New businesses are often described as being at a greater risk of failing than established businesses. Explain two reasons why this might be true.
Reason 1:
Reason 2:
