Holiday Homework

Question 1:
Factors of production refer to the inputs that are placed into a business in order for there to be production, like capital and enterprise.

Question 2:
Land: This refers to natural resources like the buying of farmland. Labor: The people that are working to produce the output, production, so basically the workers. Capital: The money that the enterprise or business generates or invests. Enterprise: It is a sum up of all the factors.

Question 3: 1. Production: Refers to the combination of the raw materials in order to produce goods and services, which are usually finished and have now entered the production line 2. Finance: This department is responsible for al of the accountings of the business and the processes. They are also involved in the investment of funds or the business and also take care of the needs of all the other departments of the business, financially. 3. Marketing: They are in charge of all of the publicity that a business undergoes to get recognition on the market. They are in charge of selling the merchandise and the sales promotion. 4. The Personnel: In this department we get the human resources of the company or business. The function of this department mainly concerns the employees of the company/business.

Question4:
It is necessary for all of the business functions to work together in order for there to be a good team work and understanding amongst the companys employees. This will prove to be an advantage because then the communication will be better and there will be no misunderstandings and the production will be likely to increase, since each department will know in which direction to pitch for, a direction which will probably be in accordance with the other departments and their needs and capabilities. The pros of this will be seen on the long run when the production increases and the yearly dividends also do.

Question 5:
1. Primary Sector: This involves the extraction and the production of raw materials. Such as coal, wood, iron and cooper. 2. Secondary Sector: This involves the transformation of the raw materials that were extracted in the primary sector into usable goods. Like steel being manufactured to make machinery or wood into furniture. 3. Tertiary Sector: Involves the provision of services to consumers, this may include an accountant, a babysitter and an IT technician. 4. Quaternary Sector: The research and development that goes into the development of products form natural resources. Like a company researching into how to make fuel form hydrogen.

Question 6:
In a less developed country there will be more people working in the primary and secondary sectors but mainly in the primary. This will be due to the fact that the countrys population is under educated and the vast majority of the people will not have access to university or a more advanced educational system which will result in them working on the primary sector because this does not need a lot of education like the tertiary and the quaternary sector do. In a developing country the people will have more access to education and they will start to move on form the primary sector into the tertiary not so much into the quaternary sector. This is due to the reason that the country will have a better economy and it will be able to invest in its educational system. However they will still need to depend on the primary sector. On a fully developed country the people will mainly work in the quaternary and tertiary sector dude to the fact that there will be a more educated population on the country. Therefore they will ask for more money to work on more tribal jobs like the extraction of raw materials, this is why the countrys will be more into the other sectors.

Question7:
1. Public Sector: the government runs them, education in some cases health and hospitals, police and other public businesses are considered to be in the public sector. 2. Private Sector: They are companies and businesses that are run by people that have no link to the government. The shares are freely sold in the market or may belong to a specific group of people.

Question 8:
Mixed Economies: Refers to an economy, which combines the public and private enterprise.

Free Market or Economy: It is an economy in which the sellers and the buyers are able to transact freely with no governmental control or small governmental control. They are based on supply and demand. Command Economies: It is an economy in which production, prices and incomes are determined by the government.

Type of Definition Busines s Sole Trader A type of business, which is owned and run by the proprietor there is no legal distinction between the owner and the business. A business which has two or more persons in charge of its management

Advantages (3)

Disadvantages (3)

1. They can manage themselves. 2. More control over the business. 3. Decisionmaking is easier.

Partner ship

1. The responsibility is shared. Therefore less liability. 2. More capital is available for the business. 3. More chance of receiving an external loan. 1. 1. There is limited liability. 2. The business has a continual existence if the partners decide to drop out. 3. Minimum number of shareholders to

Private Limited Compan y

A company which its shares are not freely sold to the public.

1. There is an unlimited liability in the business. 2. The responsibility is not shared. 3. Taxes are paid on a personal level. No room for tax planning. 1. The decision process is slower. 2. There are bound to be disagreement problems. 3. Liable for wrong decisions made by the other partner. 1. Growth limited, since there are a maximum number of shareholders. 2. In order to sell shares there has to be a mutual agreement by

Who is this business structure suitable fore? A person who likes independenc e and who likes to make decisions by himself.

Someone who wants to share responsibilit y. Or doesnt have the skills necessary to run the business. People who want to share liability. Or someone who doesnt want to take part in the business.

start up is 2. Public Limited Compan y A company, which its shares are freely sold on the stock exchange. 1. There is limited liability amongst the shareholders 2. There is continuity if any shareholder dies. 3. The shares are freely transferable. 1. There is an efficient control of the business 2. Expert administrative services 3. No risk, government pays for all. 1. No risk amongst the company. 2. Good social responsibility (CSR) 3. Good Public image. 4. Helping the world. 1. Share liquidity 2. You count with more loan options. 3. Less risk, government assumes part of the risk. 3. 1.

2.

3. 1.

Public Sector Enterpri se

It is a business or company who is partially or completely owned by the government.

2. 3.

Nonprofit and nongovern mental organiz ation

It consists on a company which does not belong to the government and whose goal is not to make money. Like UNICEF PublicIt is a private Private company, partners which sell hips shares in the stock exchange.

1.

2. 3.

all the other shareholders. High taxes There are a lot of legal formalities in order to create the business. The original owners may lose control due to the liquidity of shares. May face management problems. Government bears losses and this leads to higher taxation of the population. Political pressure Government completely controls the business. You count with no capital to support the business if they stop donating. High liability. Constant focus on fundraising.

People who want to benefit form the share price of the company.

Government

A person who wants to help the world doing something good.

1. Share value decreases. 2. Fewer dividends, because of the more shares. 3. Difficult to manage.

Companies who whish to have the support of the government.