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IGCSE Business Studies

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Presentation on theme: "IGCSE Business Studies"— Presentation transcript:

1 IGCSE Business Studies
Unit 1 – Business Activity Chapter 1: The Purpose of Business Activity

2 In this unit you will learn…….
The economic problem of unlimited wants and limited resources The factors of production The development of economic activity and the use of specialization What is meant by a business The most common aims of business The different groups involved in business activity.

3 Classify these. Needs Wants

4 Needs and Wants Wants Needs
Non-essential goods and services that people would like to have. Interests & Tastes Needs Essential goods or services necessary for living. Satisfy the basic things for life.

5 Limit your wants to no more than 25 items please!
Make your list Needs Wants Limit your wants to no more than 25 items please!

6 Why? Why? Why?

7 Why? Why? Why?

8 Is this the answer?

9 The Economic Problem Factors of Production
The shortage of goods & services TOO FEW FACTORS OF PRODUCTION! Land Labour Factors of Production Enterprise Capital

10 All of the natural resources provided by nature
Land All of the natural resources provided by nature

11 All people’s efforts to make products
Labour All people’s efforts to make products

12 All finance, machinery & equipment in manufacturing products
Capital All finance, machinery & equipment in manufacturing products

13 Enterprise All people that have skills & have risk-taking ability  factors of production  produce good or service

14 Limited in Supply Economic Problem Factors of Production Labour Land
Enterprise Capital Limited in Supply

15 Real Economic Problem + = Unlimited Wants Limited Resources Scarcity

16 Limited Resources: Choice
Individual Business Government Opportunity Cost

17 Summary – Economic Problem

18 Limited Resources Production 200 years ago
1 2 3 4 Joe cuts the wood He assembles the table Joe polishes the table Joe delivers the table on a horse and cart

19 Limited Resources Modern Day Production
1 2 The wood for 20 tables is cut with a specialist machine Carpenters assemble the tables 4 3 A transport company collects the tables to deliver them to furniture retailers The tables are finished in the polishing department

20 Making the best use of limited resources
Specialization / Division of Labour Production Process Different tasks split up Workers performs a task

21 Specialization Division of Labour
Advantages Specialised task training Increases efficiency Increases output Save time Disadvantages Bored workers Possible drops in efficiency Production stopped due to absence

22 Why business activity is needed?
Unlimited wants 4 factors of production Resources in limited supply to make goods and services Scarcity Limited resources – unlimited wants Choice Opportunity Cost Specialisation Improves efficient use of resources

23 Aim of Businesses Combine factors of production Produce products
satisfy peoples wants

24 Classification of Products
Goods Physical items Tangible Touch and see Services Intangible

25 Business Activity Combines scarce factors of production in order to produce good and services Produces those goods and services which are needed to satisfy the needs and wants of the population Employs people as worker and pays them wages to allow them to consume products made by other people

26 Business Objectives Aim / Target to work towards Make a Profit
To increase added value To expand the business To achieve business survival To provide a service

27 Profit

28 - = Value Added Value Added Selling Price Cost of materials/

29 Growth

30 Survival

31 Providing a service

32 Business Objectives Activity
Get into groups and look at the text and prepare to explain to the rest of the class what your objective means. Group 1 – Profit and Growth Group 2 – Added Value Group 3 – Survival and providing a service Prepare to give a presentation on your findings

33 Activity

34 Conflict in Business

35 Summary – Business Objectives

36 Groups involved in Business
Owners Workers Managers Consumers Government Community

37 Summary of Stakeholders

38 Explain and provide examples for the following…….
The difference between wants and needs, with examples Scarce resources Principle of opportunity costs Importance of specialization in production Purpose of business activity Importance of different groups in business activities.

39 Assignment 1 IGSCE Business Studies The purpose of Business Activity
Revision Questions

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