Business Studies Grade 10 - Chapter 5: Business Sectors

Vocabulary terms and definitions from the Grade 10 Business Studies Chapter 5 notes regarding primary, secondary, tertiary, formal, informal, public, and private sectors.

Primary Sector

The first stage in the production process that deals with the extraction of raw materials and collecting resources directly from nature.

Secondary Sector

The sector responsible for converting, processing, or manufacturing raw materials into final products; it acting as a link between extraction and the consumer.

Tertiary Sector

The sector that distributes goods processed in the secondary sector to consumers and provides services to both consumers and other businesses.

Formal Sector

Refers to businesses that are legally registered, pay tax, are controlled by government laws, and operate within the mainstream of the economy.

Informal Sector

Refers to businesses that are not registered, do not pay tax, and fall outside the mainstream economy, often including activities by people unable to find formal jobs.

Public Sector

Industries that are state-owned, state-run, or parastatals, aimed at meeting the needs of society rather than making a profit.

Private Sector

The sector owned by entrepreneurs that is profit-driven and aimed at meeting both the needs and wants of society.

Parastatals

State-owned or state-run entities that are categorized under the public sector.

Capital Intensive

A characteristic of the formal sector which involve the high usage of machinery and equipment requiring substantial investment.

Labour Intensive

A characteristic of the informal sector where operations rely more on manual work and do not require a huge capital outlay for establishment.

Gross Domestic Product ($GDP$)

The measurement of a country's economic output; formal sector output is measured in these figures while informal sector contributions must be estimated.

Mainstream Economy

The primary economic system of a country where registered and taxed businesses (formal sector) operate.

Non-profit Organisations ($NPOs$)

Organizations categorized under either the public or private sector that do not operate with a profit motive.

Entrepreneurship

The act of self-employment and business creation, which is encouraged by the informal sector as a means of survival and income.

Marginalised Economy

Another term for the informal sector or the second economy which provides opportunities for disadvantaged individuals through street trade.

Extraction

The process used in the primary sector to obtain minerals such as coal and gold from the earth.

Manufacturing

The process of turning raw materials into finished goods, which is a core activity of the secondary sector.

Spaza Shops

An example of a home-based business often found in the informal sector.