Chapter 2, Business `Sectors and Types of Business

Question 1

Chain of Production

Answer 1

stages a product passes through until it reaches the final consumer

Question 2

Primary Sector

Answer 2

Extractive industries. Farming, forestry, fishing, and mining (oil and gas)

Question 3

Secondary Sector

Answer 3

Manufacturing. turning raw materials into semi-finished and finished products. Also includes construction industry

Question 4

Tertiary Sector

Answer 4

The output of services. retailing, banking and transportation, as well as leisure industries.

Question 5

Deindustrialisation

Answer 5

the decline In the second sectors of the economy

Question 6

Private Sector

Answer 6

a business owned by private individuals usually for profit

Question 7

Public Sector

Answer 7

business/ organization owned or run by the local government to provide a service, not profit

Question 8

Advantages of a Sole Trader

Answer 8

• few legal requirements
• quick decision making
• keeps all profit
• cannot be taken over
• the financial state of business can be kept private

Question 9

Disadvantages of a Sole Trader

Answer 9

• unlimited liability
• perform all business functions
• limits growth
• overworking

Question 10

Private Limited Company

Answer 10

• ends with ‘Limited’ or ‘Ltd’
• cannot sell shares on the stock market
• no minimum share capital
• Shareholders can be Directors
• one vote per person

Question 11

Public Limited Company

Answer 11

• ends with ‘plc’
• can sell shares on the stock market
• can be involuntarily be taken over by shareholders
• minimum share capital of £50,000
• shareholders appoint a ‘Director
• Shareholders receive Report and Accounts yearly
• one vote per share