Section 1

Question 1

What is a primary sector?

Give me 3 examples

Answer 1

Where raw materials are collected

Fishing
Farming
Mining

Question 2

What is a secondary sector? Give me 3 examples.

Answer 2

Where raw materials are being produced into products

Car manufacturing
Factories
Medicine testing

Question 3

What is a tertiary sector?

Answer 3

Where the products are being sold to customers.

Cinema
Hairdresser
Supermarket

Question 4

Which sector has gone up and why?

Answer 4

Tertiary sector

• population grown (more customers)
• more leisure time (time to spend)
• machine cannot to customer service ( more employees)(human contact is important)
• more money, therefore want more good as they can afford it

Question 5

Which sector has gone down and why?

Answer 5

Secondary and primary sector

• raw materials already used up (also cheaper abroad)
• machines do job quicker

Question 6

What is specialisation?

Give an example.

Answer 6

A business that focuses on one type of product

Disneyland focuses on only toys and cartoons (things for kids)

Question 7

What is deindustrialisation?

Answer 7

A reduction in the size of primary and secondary sectors in an economy

Question 8

What is added value?

Answer 8

Adding a value to the original product (price increases)

The value could be the brand

Question 9

What is the SMART subject?

Answer 9

S- specific 
M- measurable 
A- agreed
R- realistic 
T- time framed

Question 10

What is the common business objective?

Answer 10

A mission statement - a phrase to tell the firm’s intention

Question 11

What is a private sector?

Answer 11

An organisation owned and controlled by private individuals

E.g. HSBC, McDonald, Virgin

Question 12

What is a public sector?

Answer 12

An organisation owned and controlled by the government

E.g. Schools and hospitals

Question 13

What are the 6 business objectives?

Answer 13

Survival- survive and not shut down within 1 year

Profit- earning extra money

Returns to shareholders- returning the money that investors invested

Growth- develop into a bigger and better organisation

Market share- have a higher percentage share than other businesses

Providing customer service- more customers

Question 14

What is PLC and what does it mean?

Answer 14

Public limited company

A company that allows te public (anyone) to buy shares from the company

Question 15

What is LTD and what does it mean?

Answer 15

Private limited company

A company that only allows family and friends to buy shares (no one else)

Question 16

What is a stakeholder?

Answer 16

People who are affected by a business and are involved

Question 17

What are the 2 types of stakeholders ?

Answer 17

Internal stakeholder -

Involved in the business (inside the business)

External stakeholder-

People who are outside the business

Question 18

What is industrial action?

Answer 18

Involving trade unions and strikes as there is a conflict between stakeholders

Question 19

What is a capital?

Answer 19

Amount of money invested in a business

Question 20

What is an incorporated business?

Answer 20

A business that is in a legal corporation

• contracts
• registering
• legal businesses

Question 21

Which type of companies are incorporated business?

Answer 21

Big organisations/business

Question 22

What is an unincorporated business?

Answer 22

Business that isn’t in a legal corporation

• no papers
• no registration

Question 23

Which type of businesses are unincorporated businesses?

Answer 23

Small businesses

Question 24

What is a sole-trader?

Answer 24

An individual who owns and controls their own business

Question 25

What are the avantages of being a sole-trader?

Answer 25

- easy and cheap to set up business (no complicated forms) - can make your own decisions - competitors CANNOT see your account - all profit goes to the owner

Question 26

What are the disadvantages of being a sole-trader?

Answer 26

- unlimited liability (loss in business can affect owner's personal life) - difficult to find cover when I'll - if dies, business stops - pays everything with own money - different responsibilities, harder to handle - no specialised skills - work long hours for success

Question 27

Give me 2 examples of who might have an unincorporated business?

Answer 27

Sole-trader Partnership

Question 28

What is a partnership?

Answer 28

When 2 or more people control a business together

Question 29

What are the advantages of a partnership?

Answer 29

- more people have specialised skills - competitors can't see your account - risk and responsibilities are shared - easier to raise finance (money)

Question 30

What are the disadvantages for a partnership?

Answer 30

- Unlimited liability - argument and conflict - trust issues

Question 31

What is a sleeping partner ?

Answer 31

Someone that invest in business but isn't involved in the activities of it.

Question 32

What are the 4 main qualities a partnership should have?

Answer 32

- loyalty - trust - good communication - compromising

Question 33

What is a deed of partnership?

Answer 33

A legal document explaining how the partnership will work - profit and losses sharing - capitals of each partner - duties of partners - duration of partnership - what will cause the termination of the deed (conflict? Loyalty?)