U1- Role Of Business In Society Flashcards
What is the main role of business’?
To create wealth for society by adding value. This means adding or changing something to a resource that increases the price which can be charged to the customer
Give 4 aims of business
Provide employment
Increase individuals personal wealth
Create competition needed for low prices and efficiency
Support worthy causes e.g. Charities
What are the 4 sectors of industry?
Primary
Secondary
Tertiary
Quaternary
Describe a primary industry
They are involved in exploiting natural resources from the land, sea and air
Describe a secondary industry
They include all the manufacturing industries and construction. For example building houses and bridges and hospitals and schools
Describe a tertiary industry
They do things for us, and include things such as bus travel, restaurants and holiday companies
Describe a quaternary industry
These are referred to as the knowledge based part of the economy. They are a subset of the tertiary industries and include ICT, education, consultation and research and development
Why have there been changes in the sectors? And what are these changes?
More machinery, as well as cheaper labour costs abroad has lead to a decrease in primary and secondary industries.
There has been growth in the tertiary and quaternary sectors as retail, ICT and medical sciences are increasing important for the economy
Name the 3 sectors of the economy
Private sector
Public sector
Third sector
Describe the private sector
This is made up of profit making businesses
These are set up by private individuals whose main aim is to make a profit
They can be multinationals, public limited companies or private limited companies
Describe the public sector
This is made up of organisations set up by the government to provide a service, either locally or nationally
These services include things which are thought to be of benefit to society such as education and health
It provides services which cannot be or are too expensive to be provided by the private sector
Describe the third sector
This is made up of charities, voluntary groups, clubs and associations
It exists to benefit individuals in society or members of that organisation
It exists to provide a service which the private and public sector would not do well
Summarise the private sector. Give 4 bullet points
Controlled by a board of directors
Owned by shareholders
Limited liability
Financed by shares
Summarise the public sector. Give 4 bullet points
Government owned
Financed by taxes
Controlled by government appointed managers
Run by a board of trustees/ elected officials
Summarise the third sector. Give 3 bullet points
Controlled by trustees
Financed through donations
Not owned by trustees can be liable
