Cambridge IGCSE Business Studies
1 Business activity Answers to Worksheet 1 Business activity basics Business activity 1 Needs – items that we must have in order to live. Wants – items we would like to have, but are not essential. 2 a False – the purpose of business activity is to produce goods and services that people need and want. b True c False – specialisation only tries to make the best use of limited resources. 3 The economic problem is trying to meet unlimited wants but only having limited resources to produce all the goods and services to meet these wants. This leads to scarcity. Factors of production 4 Factor Description Space and resource obtained from the land Land People who make things Labour Buildings and inventory Capital People who take risks to bring about activity Enterprise
Example Fish from the sea Machine operator Buy new machinery Investors
5 Buying a new building increases a business’s capital. Added value 6 $3500
$500 profit Added value
$1000 labour costs
$2000 Cost of bought in materials
Sectors 7 Most economies are made up of two main sectors. The private sector includes businesses that are owned and run by individuals. The public sector is made up of organisations owned and run by the state. There is also a third sector, known as the non-profit-making or voluntary sector, which includes organisations such as charities.
© Cambridge University Press 2014 Cambridge IGCSE Business Studies
Chapter 1 Resources
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