Understanding Business Activity and People in Business

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Across
  1. 2. once a business has passed its survival stage it will aim for growth and expansion. This is usually measured by value of sales or output. Aiming for business growth can be very beneficial. A larger business can ensure greater job security and salaries for employees. The business can also benefit from higher market share and economies of scale.
  2. 3. the risk taking ability of the person who brings the other factors of production together to produce a good or service. The reward for enterprise is profit from the business.
  3. 6. this consist of all the services provided in an economy. This includes hotels, travel agencies, hair salons, banks etc.
  4. 7. the finance, machinery and equipment needed for the production of goods and services. The reward for capital is interest received on the capital
  5. 9. the natural resources that can be obtained from nature. This includes minerals, forests, oil and gas. The reward for land is rent
  6. 11. there are very few legal formalities involved in starting and running a sole proprietorship. A less amount of capital is enough by sole traders to start the business. There is no need to publish annual financial accounts.
  7. 12. a good or service that people would like to have, but is not required for living. Examples include cars and watching movies
  8. 13. this is the income of a business from its activities after deducting total costs. Private sector firms usually have profit making as a primary objective. This is because profits are required for further investment into the business as well as for the payment of return to the shareholders/owners of the business.
  9. 14. since it is a small form of business, the owner can easily create and maintain contact with customers, which will increase customer loyalty to the business and also let the owner know about consumer wants and preferences.
  10. 16. Since there is only one owner, the sole owner has to undertake all running activities. He/she doesn’t have anyone to share his responsibilities with. This workload and risks are fully concentrated on him/her.
Down
  1. 1. this involves the manufacture of goods using the resources from the primary sector. Examples include auto-mobile manufacturing, steel industries, cloth production etc.
  2. 4. this involves the use/extraction of natural resources. Examples include agricultural activities, mining, fishing, wood-cutting, oil drilling etc.
  3. 5. new or small firms usually have survival as a primary objective. Firms in a highly competitive market will also be more concerned with survival rather than any other objective. To achieve this, firms could decide to lower prices, which would mean forsaking other objectives such as profit maximization.
  4. 8. this can be defined as the proportion of total market sales achieved by one business. Increased market share can bring about many benefits to the business such as increased customer loyalty, setting up of brand image, etc.
  5. 10. the sole trader has full control over the business. Decision-making is quick and easy, since there are no other owners to discuss matters with.
  6. 15. a good or service essential for living. Examples include water and food and shelter
  7. 17. the physical and mental efforts put in by the workers in the production process. The reward for labour is wage/salary