A business is defined as an organization or enterprising entity engaged in commercial, industrial, or professional activities. ... The term "business" also refers to the organized efforts and activities of individuals to produce and sell goods and services for profit.
Getting Real with AI - Columbus DAW - May 2024 - Nick Woo from AlignAI
Chapter 1 business activity
1. Chapter 1 – Business
Activity
Unit 1 – Understanding Business Activity
2. In this unit you will learn…….
The economic problem of unlimited wants and
limited resources
The factors of production
The development of economic activity and the
use of specialization
What is meant by a business
The most common aims of business
The different groups involved in business
activity.
4. Needs and Wants
Needs
› Essential goods or
services necessary
for living.
› Satisfy the basic
things for life.
Wants
› Non-essential goods
and services that
people would like to
have.
› Interests & Tastes
16. Limited Resources
Production 200 years ago
Joe cuts
the wood
He
assembles
the table
Joe
polishes the
table
Joe delivers the table on a
horse and cart
1 4
3
2
17. Limited Resources
Modern Day Production
The wood for 20 tables is cut
with a specialist machine
Carpenters assemble the
tables
The tables are finished in the
polishing department
A transport company collects the tables to
deliver them to furniture retailers
1
4
3
2
18. Making the best use of limited
resources
Specialization / Division of
Labour
Production Process
Different tasks split up
Workers performs a task
19. Specialization
Division of Labour
Advantages
Specialised task training
Increases efficiency
Increases output
Save time
Disadvantages
Bored workers
Possible drops in efficiency
Production stopped due to absence
20. Why business activity is
needed?
Unlimited wants
4 factors of production
Resources in limited supply to make goods and
services
Scarcity
Limited resources – unlimited wants
Choice
Opportunity Cost
Specialisation
Improves efficient use of resources
21. Business Activity
Combines s_____ f_____of p_______ in
order to produce g_____ and s_______.
Produces those goods and services which are
needed to s______ the n______ and w_____
of the p___________
E_______ people as worker and pays them
w____ / s______ to allow them to consume
p_______ made by other p________.
22. Aim of Businesses
Combine factors of production
Produce products
satisfy peoples wants
Get a student at random to read one point that they will learn.
Elicit from the students why wants are unlimited, i.e. because most people in the world cannot but everything.
Here students should write the meanings of needs and wants in their books. Make sure they write the date at the top, followed by the unit heading “Unit 1 – The Purpose of Business Activity” followed by the sub-heading “Needs and Wants”. They then write their examples in 2 columns, one with the heading of needs, the other with wants. When done, elicit 2 wants from students at random.
Students have 15 minutes to draw the table and complete.
What students should realize here that wants are unlimited. We always want more and more.
We are not able to have absolutely everything.
Donald Trump a Billionaire Real Estate Developer and television celebrity
Sir Richard Branson Famous British entrepreneur, billionaire and founder of the Virgin brand
Bill Gates Cofounder of the Microsoft software company and the richest man in the world (Paul Allen)
Mary Kay - Business woman and founder of Mary Kay Cosmetics
Oprah Winfrey Billionaire Talk Show Host and Actress
There is never enough land, labour, capital or enterprise to produce all the needs and unlimited wants of the whole population, so there is an economic problem of scarcity
Opportunity Cost = “what we have to give up”
Recap
Discuss with the students this old production method.
He does everything by himself
Production is slow.
Discuss with the students this modern production method.
Workers are skilled and Production is slow.
Go through these points. Get the students to discuss the advantages and disadvantages this may incur.
Advantages: Avoids wasting time from moving people from different stages of production, total output increased, productivity increased (output per worker), use of other firms for the non-productive parts of his business (delivery of materials, transportation, sales), improves efficiency
Disadvantages: Boredom of workers from doing the same job, outside suppliers and retailers could be unreliable.
Students put the heading “Specialization and Division of Labour” note down in their own words, both the meaning and adv / dis adv.
Get some examples from the students.
Go through business activity.
Discuss “What would life be without business activity?”
Students put their views across - consequences include undeveloped societies, little choice of products, self-sufficient etc
Businesses can be big or small, but they all have these three things in common.
House – Selling Price $100,000 – Cost of bricks, cement, woods & other materials $15,000 = Value added $85,000
Table – Selling Price 100 – Cost of wood, screws, metals & other materials $ 35 = Value added $65
Value added is achieved by working on materials and/or components to make them into much more expensive finished goods
Each group given a company and they discuss in groups how to add value.
E.g. 1 – Leather company could make jackets, wallets, shoes, bags etc to add value rather than just selling the leather.
E.g. 2 – A chocolate manufacturer could use a more appealing/expensive wrapping and charge a higher price.
E.g. 3. – A housing developer my opt for very nice upscale gardens to push up the price of the housing estate.
E.g. 4. – A jeweler could put up attractive displays, creating the luxury feel and/or offer gift wrapping
E.g. 5 – An electrical goods manufacturer could add features to their products to increase the price
