Business Studies: All Topics

A good or service essential for living, such as basic food, clean water or shelter.

A good or service people would like to have but do not need to survive, such as a luxury holiday.

Needs are essential for living; wants are desirable but not essential.

People can continue wanting additional goods and services even after other wants are satisfied.

Unlimited wants exist alongside limited resources for producing goods and services.

There are insufficient resources and products to satisfy all the wants of a population.

The resources used by businesses to produce goods and services.

Land, labour, capital and enterprise.

Natural resources, including farmland, forests, oil, gas and mineral deposits.

The people and human effort available to make goods and provide services.

Finance, machinery and equipment used in producing goods or services, as described in the textbook.

The skill and willingness to take risks when organising other factors to produce goods or services.

A person who takes business risks and combines resources to produce goods or services.

The next best alternative forgone when a choice is made.

Limited resources cannot satisfy every want, so some possible uses must be given up.

When people or businesses concentrate on the tasks or products they are best at.

Splitting production into separate tasks so each worker concentrates on one task.

To combine factors of production to make goods or services that satisfy people’s needs and wants.

A physical product that customers can see and touch, such as a car or shoes.

An activity provided to customers rather than a physical product, such as banking or tourism.

The difference between a product’s selling price and the cost of bought-in materials and components.

Added value = selling price − cost of bought-in materials and components.

Increase selling price while holding material costs constant, or reduce material costs while holding selling price constant.

It does not increase the available factors of production or output of goods and services; if spending rises without output rising, prices may rise instead.

Scarcity forces individuals, firms and governments to choose between uses of resources; the value of the next best rejected choice is the opportunity cost.

Wheat is land (a natural resource); bakers are labour; ovens are capital; the risk-taking owner provides enterprise.

Enterprise involves coordinating resources and bearing the risks of the business; labour refers to the human work used to produce its output.

Labour is a limited factor of production; without enough skilled workers, the firm may be unable to increase output despite demand.

The car that the student gives up, not the price of the holiday.

Machine B and the benefits it would have provided.