Ch.1- Business Activity

Question 1

Business Activity

Answer 1

The process of producing goods and services to satisfy consumer demand

Question 2

Need

Answer 2

A good or service which is essential to living

Question 3

Want

Answer 3

A good or service which people would like, but is not essential for living.

Question 4

Economic problem

Answer 4

The basic problem of scarcity; unlimited wants cannot be met because there are limited factors of production.

Question 5

Factors of production

Answer 5

The resources needed to produce goods and services- land, labour, capital and enterprise.

Question 6

Scarcity

Answer 6

There are not enough goods and services to meet the wants of the population.

Question 7

Opportunity cost

Answer 7

The benefit that could have been gained from an alternative use of the same resource.

Question 8

Specialisation

Answer 8

People and businesses concentrate on what they are best at.

Question 9

Division of labour

Answer 9

Production is divided into separate tasks and each employee does just one of those tasks.

Question 10

Consumer goods

Answer 10

Products which are sold to the final consumer. They can be seen and touched.

Question 11

Consumer services

Answer 11

Non-tangible products such as insurance services, transport.

Question 12

Capital goods

Answer 12

Physical goods, such as machinery and delivery vehicles, used by other businesses to help produce other goods and services.