The Different Sectors Of Business Activity
BY ACTIVITY & BY OWNERSHIP
Primary Sector
1.
Primary Extracts and uses the natural resources of the earth, Such as farming, fishing, forestry
The PRIMARY sector\
Mining Farming Fishing Drilling Forestry BASICALLY ANY EXTRACTIVE BUSINESS
Secondary sector
. Secondary, Manufactures goods using the raw materials provided by the primary sector, Such as building, aircraft making, computer assembly
The SECONDARY sector
Manufacturing Construction Ship
building Processing Basically any business that CHANGES a product in any way.
Tertiary Sector
Tertiary, Provides services to consumers and the other sectors of industry, Such as transport, banking, insurance.
The TERTIARY sector
Banking Health Insurance Travel Hotels Entertainment
Basically any business which offers a SERVICE
The CHAIN of PRODUCTION
This is the way a product moves through each of the business sectors. For example, this would be the journey that oil takes.
UNDERDEVELOPED COUNTRY primary sector is not fully utilized, no health facilities, no education and employment. Less food , no drinking water. Eg. Africa, SOMALIA
DEVELOPING COUNTRY - Country, primary industries employ many more people than manufacturing or services industries. SECONDARY SECTOR IS NEW. Low income eg Pakistan , India , Bangladesh. DEVELOPED COUNTRY: - Country where the output of tertiary sector is often higher than the primary sector and secondary sector. More income. Eg America, UK, Australia
Economic Systems
3 different types of economic system which are used by countries to manage their resources as efficiently as possible: 1. Free market economy. 2. Command or planned economy. 3. Mixed economy.
Free Market Economy
Free
market economy: - All resources are owned privately. - There is no government control. - Profit. - Prices of goods are influenced by demand and supply of goods.
Free market economy
Free
market economy: - Advantages: * Consumers are free to choose. * Workers are encouraged to work hard. * Business compete. * New businesses are encouraged. - Disadvantages: * No government control
Command Or Planned Economy
Command
or planned economy: - Government controls the use of resources. - Advantages: * There should be work for everybody. - Disadvantages: * Less incentive to work. * The government may not produce goods which people want to buy.
Mixed Economy
Mixed
economy: - Combines free market economy and command economy. advantages and disadvantages of both the systems.
Has
Privatisation
Privatization:
Governments sold off businesses they previously owned to new owners in the private sector.
Advantages
- Profit, run the business efficiently. - Keep the price low. - Additional capital. - Raises money for the government Workers motivated. - revives failing business.
DISADVANTAGES
- Owners interested in profits and may close loss making units. - might run business as monopoly. - may reduce workers to increase efficiency creating unemployment. -
Size of business
Business
size can be measured in a number of ways, such as: 1. By number of employee. 2. By value of output and sales. 3. By profit. 4. By capital employed.
NO. OF WORKERS EMPLOYED
1. Simple. 2. Easy. 3. large no. of workers means firm is large. BUT 4. Some use production methods & less workers & produce more [Link] factories.
SALES & VALUE OF OUTPUT
1.
Measures size. 2. used for same business in same industry. Compares market share captured.
BUT