Notes: Unit 1.1: What is a Business?

Vocabulary flashcards covering key concepts from the notes on the nature of a business, production inputs/outputs, sectors of the economy, and entrepreneurship.

Business

An organization that exists to satisfy the needs and wants of customers by selling goods and services, usually for profit, using human, physical and financial resources.

Goods

Tangible physical products produced by a business (e.g., food, clothes, cars, smartphones).

Services

Intangible products provided by a business (e.g., haircuts, banking, education, healthcare).

Input

Resources used in production, including land, labour, capital, and enterprise.

Process

The set of actions or steps applied to inputs to transform them into outputs.

Output

The goods or services produced by a business.

Land (Factor of Production)

Natural resources used to produce goods and services (e.g., water, timber, minerals).

Labour

Human effort used to produce goods and services.

Capital

Non-natural, man-made resources used in production (e.g., machinery, tools, buildings, infrastructure).

Entrepreneurship

The knowledge, skills and willingness of individuals to organize and manage production, often taking on risks to profit.

Entrepreneur

An individual who plans, organises and manages a business, taking on financial risks.

Primary sector

Businesses involved in the extraction or harvesting of natural resources.

Secondary sector

Businesses involved in manufacturing or construction of goods.

Tertiary sector

Businesses that provide services to the general population.

Quaternary sector

Intellectual, knowledge-based activities that generate and share information.

Chain of production

The sequence linking extraction, manufacturing and services as an item moves to the consumer, with value added at each stage.

Value added

The increase in worth of a product as it moves through the chain of production.

Human Resources

Department that manages the organization’s personnel, including recruitment, training, appraisals, dismissals, and outsourcing.

Finance and Accounts

Department that manages money, records financial documents, and informs stakeholders; ensures legal compliance.

Marketing

Identifies and meets the needs and wants of customers; uses the seven Ps of marketing.

Operations Management

Covers the process of converting raw materials into finished goods or delivering services.

Seven Ps of Marketing

Product, Price, Place, Promotion, People, Processes, Physical evidence.

RISER

Acronym for traits of a successful entrepreneur: Risk taker, Innovative, Strategist, Enthusiastic, Resilient.

Sustainability

Meeting present needs without compromising the ability of future generations to meet their needs.

Ethics

Moral principles guiding business decisions.

Creativity

Ability to generate new and original ideas.

Change

The process of transformation or adaptation in business.

Business Plan

A document outlining goals, strategy and steps for starting or running a business.