Business - Unit 1

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Nature and purpose of business:

A business is an organisation that turns inputs into outputs through selling a product or service to a customer.

A good is a physical product

A service is an intangible product

Businesses are of great importance to the economy as:

They create employment

They create income

They can create new products

They can enhance a country's reputation

Businesses exist to provide a product to meet customers needs and to meet the demand

There are four factors of production:

People

Land

Labour

Enterprise

Businesses exist within 3 sectors:

Primary Sector: Raw materials: Farming, fishing, mining, oil extraction

Secondary Sector: Manufacturing of goods: manufacturing, construction, oil refining, water and electricity supply

Tertiary Sector: The supply of services: hotels, catering, transport, education and health