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BSNOTESQ1

The document outlines key concepts in business studies, including the distinction between needs and wants, factors of production, and the importance of scarcity and opportunity cost. It explains the roles of consumer goods, services, and capital goods, as well as the three sectors of business: primary, secondary, and tertiary. Additionally, it highlights the significance of adding value through branding, service quality, and product features.

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12 views2 pages

BSNOTESQ1

The document outlines key concepts in business studies, including the distinction between needs and wants, factors of production, and the importance of scarcity and opportunity cost. It explains the roles of consumer goods, services, and capital goods, as well as the three sectors of business: primary, secondary, and tertiary. Additionally, it highlights the significance of adding value through branding, service quality, and product features.

Uploaded by

GamingVlog Box
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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BUSINESS STUDIES NOTES: MANARAT AL RIYADH---QUIZ 1 TERM 1 AND

MAKEUP---By HAMZA NAVEED 9BR1

 Businesses intend to satisfy consumer needs and wants.


 A need is anything essential for survival, such as food,
water, and shelter.
 A want is something we like to have but don’t need, such
as holidays.
 The factors of production are Land, labour capital, and
enterprise
Land: Any natural resource used by a business, such as land,
rivers, ores.
Labour: People involved in the production, such as accountants
or engineers
Capital: Machinery, equipment, and finance used in a business
Enterprise: People prepared to take the risk of starting a
business
IMPORTANT TIP
Capital has different meanings in Economics
and Accounting. Make sure you remember the
correct one for this exam.

Scarcity refers to the lack of resources to satisfy our infinite


wants. This is known as the Economic problem (just like in
Economics if you’re studying it). Since we cannot have all the
goods we want, we have to make choices. The alternative
benefits gainable using the same resources, which we did not
avail, is called Opportunity cost.
EXAMPLE: You have 100$. You can either buy a new video game
or you could invest it in your friend’s business he runs in
school.
* If you choose the video game, the opportunity cost will be the
benefits of the investment
* If you choose the investment, the opportunity cost will be the
possible benefits of the video game
In the past, goods were produced by just one person who
performed all the necessary tasks. Nowadays, different
employees focus on different tasks during the production
process. This is called specialization. The division of labour

1
BUSINESS STUDIES NOTES: MANARAT AL RIYADH---QUIZ 1 TERM 1 AND
MAKEUP---By HAMZA NAVEED 9BR1

refers to splitting of tasks in the production process so that


each employee focuses on one task only.
Businesses can provide:
Consumer goods: Goods for the final customer that can be seen
and touched, such as cars or computers
Consumer services: Products which cannot be seen or touched,
such as insurance, banking and buses
Capital goods: Used by other businesses in the production
process, such as machinery

Businesses aim to add value; that is, they combine raw


materials into a finished product, which they sell for a higher
price. Some ways to add value are:
 Branding (marketing to promote a brand’s image and
name)
 Excellent service quality (personalized service)
 Product features
 Convenience (saves time and can be used without hassle)

The three sectors of business are:


 Primary sector: Involves the extraction of raw materials,
such as farming.
 Secondary sector: Involves making finished goods, such as
car-making.
 Tertiary sector: Involves providing a service, such as
restaurants.
All the sectors are related to each other and form a chain of
production.
In most cases:
 A less developed country (LDC) has more people
employed in the primary sector and lesser people
employed in the tertiary sector.
 A more developed country (MDC) has more people
employed in the tertiary sector and lesser in the primary
sector.

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