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Transforming resources into goods and services



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  • 1. Transforming Resources into Goods and Services
  • 2. Challenge
    • In teams of four you are to undertake the production challenge.
    • You have 5 minutes to make key decisions and then 10 minutes to produce your products
  • 3. Production
    • Production is the transformation of resources into goods or services
    • Production takes place when a business takes Inputs , carries out a Process , and produces an Output
    • Inputs are the factors of production used, ie, raw materials and components
    • Outputs are the goods and services produced
    • Processes are the methods used to convert the raw materials and components into products
  • 4. Resources (Inputs)
    • We call these factors of production:
      • Land: The term ‘land’ incoporates all the natural resources that can be used for production, e.g. coal, oil, wood, livestock, fish, water etc
      • Labour: This involves both the physical and mental effort involved in production
      • Capital: This means goods that are made in order to produce other goods and services e.g. buildings, machinery, vehicles, computers
      • Enterprise: Bringing together other factors e.g. making decisions, providing finance, making risks
  • 5. Resources (Inputs)
    • What did you use on your production challenge?
      • Land
      • Labour
      • Capital
      • Enterprise
  • 6. Pizza Factory
    • Watch the following clip:
      • http://news.bbc.co.uk/1/hi/business/7733602.stm
    • What can you tell about the inputs in this factory?
  • 7. The Transformation Process
    • The Transformation Process is how a business turns it’s inputs into outputs.
    • Feedback is important, as it allows a business to make changes to the process, e.g. suppliers
  • 8. Outputs
    • These can be both goods and services, but is what the business produces
    • 3 Main categories
      • Primary Sector
      • Secondary Sector
      • Tertiary Sector
    • What do you understand of these sectors?
  • 9. Adding Value
    • As a business produces a product or service it aims to add value, e.g. building a house!
  • 10. Exercises
    • Practice Exam Questions
      • In RMShared > Business AS > Unit 1 learning materials > Transforming Resources into Goods and Services > Questions
    • HOMEWORK: Gourmet Burger Case Study