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It describes the four factors of production as capital, labor, land, and entrepreneurship. The four sectors of the economy are outlined as business, households, government, and rest-of-the-world. Key economic concepts like supply and demand, costs, efficiency, and elementary analysis are defined and explained over multiple chapters.
This document provides an introduction to key concepts in economics, including microeconomics, macroeconomics, and industrial economics. It explains that economics involves making decisions about scarce resources to meet wants and needs. Some important economic questions to consider are what, how much, and how to produce goods and services, as well as who gets what. The four factors of production are land, labor, capital, and entrepreneurship. There are also differences between capital goods used to make other goods and consumer goods purchased by individuals.
The document discusses different types of economic systems and how they answer the three basic economic questions of what to produce, how to produce it, and who gets what is produced. It explains that modern economies are mostly mixed, combining market forces with some government intervention. A free market uses supply and demand to determine production and distribution, while a centrally planned economy has the government control and direct all economic decisions. Most countries today utilize a mixed system with market allocation and private enterprise alongside policies to promote public goods and correct market failures.
The document discusses several key economic concepts:
1) Production is the process of transforming resources into useful goods and services. All societies must decide what to produce, how to produce it, and who gets what is produced.
2) Specialization and trade allow countries to benefit even if one has an absolute advantage in all areas, because of comparative advantage based on opportunity costs.
3) Investment uses resources to produce capital for the future, but has an opportunity cost of present consumption. Capital goods are used to produce other goods, while consumer goods are for immediate use.
4) The production possibility frontier graphically shows tradeoffs in what an economy can produce given scarce resources, and shifts outward with economic growth over time from
The document provides an introduction to the field of economics. It defines economics as the study of how societies allocate scarce resources to produce goods and services. It also distinguishes between microeconomics, which examines individual components like industries and households, and macroeconomics, which examines the overall economy. The scientific approach in economics uses techniques like observation, analysis, and statistical analysis to understand economic phenomena. Some pitfalls to avoid in economic reasoning are failing to isolate variables, making post hoc fallacies, and committing the fallacy of composition. Economics studies scarcity and how it affects production and consumption. Economic knowledge can help individuals, societies, and policymakers.
The document provides an overview of business objectives and concepts related to the economic problem. It discusses how businesses aim to:
1. Make a profit by combining scarce resources to produce goods and services that satisfy wants and needs, employing workers and paying wages.
2. Increase added value by processing raw materials into more valuable finished products that can be sold at a higher price, earning higher profits.
3. Expand the business size to gain economies of scale, market share, and job security for employees and status/salaries for managers.
4. Achieve survival by adapting to threats like new competition, recession, or recently launching in the industry.
5. Provide a community service for some government-
Business objectives and_stakeholders_objectives_presentationPaul Oluoch
The document discusses key concepts relating to business objectives and stakeholders. It begins by explaining that businesses can be started by individuals or governments for various reasons like making a profit, expanding the business, or providing a service to the community. It then outlines common business objectives such as profit, growth, survival, and value added. The document also discusses how different stakeholder groups like owners, managers, employees, customers, government, and the local community can have differing objectives and interests in the business. It emphasizes that managers must seek to balance the needs of multiple stakeholders when setting business objectives.
Business objectives and_stakeholders_objectives_presentationPaul Oluoch
The document discusses key concepts relating to business objectives and stakeholders. It provides definitions and examples of business objectives such as making a profit, growth, and survival. It also defines stakeholders as any group with a direct interest in a business, such as owners, managers, employees, customers, government, and the local community. Each of these stakeholder groups has different objectives that businesses must balance. For example, while owners prioritize profits and growth, employees prioritize fair pay and job security. Balancing these diverse stakeholder objectives is an important challenge for business management.
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The document provides an introduction to economics and engineering economics. It defines economics as dealing with production, exchange, and consumption of commodities using scarce resources. Engineering is applying knowledge to develop ways to utilize materials and forces of nature for humanity's benefit.
It describes the four factors of production as capital, labor, land, and entrepreneurship. The four sectors of the economy are outlined as business, households, government, and rest-of-the-world. Key economic concepts like supply and demand, costs, efficiency, and elementary analysis are defined and explained over multiple chapters.
This document provides an introduction to key concepts in economics, including microeconomics, macroeconomics, and industrial economics. It explains that economics involves making decisions about scarce resources to meet wants and needs. Some important economic questions to consider are what, how much, and how to produce goods and services, as well as who gets what. The four factors of production are land, labor, capital, and entrepreneurship. There are also differences between capital goods used to make other goods and consumer goods purchased by individuals.
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The document discusses several key economic concepts:
1) Production is the process of transforming resources into useful goods and services. All societies must decide what to produce, how to produce it, and who gets what is produced.
2) Specialization and trade allow countries to benefit even if one has an absolute advantage in all areas, because of comparative advantage based on opportunity costs.
3) Investment uses resources to produce capital for the future, but has an opportunity cost of present consumption. Capital goods are used to produce other goods, while consumer goods are for immediate use.
4) The production possibility frontier graphically shows tradeoffs in what an economy can produce given scarce resources, and shifts outward with economic growth over time from
The document provides an introduction to the field of economics. It defines economics as the study of how societies allocate scarce resources to produce goods and services. It also distinguishes between microeconomics, which examines individual components like industries and households, and macroeconomics, which examines the overall economy. The scientific approach in economics uses techniques like observation, analysis, and statistical analysis to understand economic phenomena. Some pitfalls to avoid in economic reasoning are failing to isolate variables, making post hoc fallacies, and committing the fallacy of composition. Economics studies scarcity and how it affects production and consumption. Economic knowledge can help individuals, societies, and policymakers.
The document provides an overview of business objectives and concepts related to the economic problem. It discusses how businesses aim to:
1. Make a profit by combining scarce resources to produce goods and services that satisfy wants and needs, employing workers and paying wages.
2. Increase added value by processing raw materials into more valuable finished products that can be sold at a higher price, earning higher profits.
3. Expand the business size to gain economies of scale, market share, and job security for employees and status/salaries for managers.
4. Achieve survival by adapting to threats like new competition, recession, or recently launching in the industry.
5. Provide a community service for some government-
Business objectives and_stakeholders_objectives_presentationPaul Oluoch
The document discusses key concepts relating to business objectives and stakeholders. It begins by explaining that businesses can be started by individuals or governments for various reasons like making a profit, expanding the business, or providing a service to the community. It then outlines common business objectives such as profit, growth, survival, and value added. The document also discusses how different stakeholder groups like owners, managers, employees, customers, government, and the local community can have differing objectives and interests in the business. It emphasizes that managers must seek to balance the needs of multiple stakeholders when setting business objectives.
Business objectives and_stakeholders_objectives_presentationPaul Oluoch
The document discusses key concepts relating to business objectives and stakeholders. It provides definitions and examples of business objectives such as making a profit, growth, and survival. It also defines stakeholders as any group with a direct interest in a business, such as owners, managers, employees, customers, government, and the local community. Each of these stakeholder groups has different objectives that businesses must balance. For example, while owners prioritize profits and growth, employees prioritize fair pay and job security. Balancing these diverse stakeholder objectives is an important challenge for business management.
This document discusses the economic problem of unlimited wants and limited resources. It explains that the scarcity of resources requires people and societies to make choices about how to allocate resources. Businesses help address this problem by combining factors of production like land, labor, capital and enterprise to produce goods and services that satisfy people's wants. Specialization of labor improves the efficiency of resource use. The document provides examples of goods and services at a supermarket to illustrate the concepts.
This document discusses key concepts in business studies including:
1. The economic problem arises from limited resources and unlimited wants, creating scarcity and requiring choices about resource allocation.
2. The four factors of production are land, labor, capital, and enterprise. Specialization allows for more efficient use of these limited resources.
3. Businesses combine the factors of production to make goods and services that satisfy wants and needs.
This chapter discusses how economies of scale can lead to international trade even when countries are identical. It provides an example where concentrating widget production in one country allows both countries to consume a variety of goods through trade, taking advantage of larger scale of production. There are two types of economies of scale - external, which apply at the industry level, and internal, which apply at the firm level. External economies can arise from specialized suppliers, labor market pooling, and knowledge spillovers between firms. The chapter focuses on external economies and how they can encourage trade by allowing industries to cluster in certain locations.
This document discusses firms and their classification, growth, and economics of scale. It begins by classifying firms by industry, sector, ownership, and size. Small firms exist for several reasons like market size, consumer preferences, and flexibility. Firms can grow internally or externally through mergers. Mergers can be horizontal, vertical, or conglomerate, and are often done to achieve rationalization. Economics of scale refer to lower costs from increased production, while diseconomies refer to higher costs. Both internal and external scales can impact firms and industries.
Economies of scale refers to decreased per-unit costs as production increases. As a firm produces more, average costs fall due to efficiencies from mass production and distribution of initial capital costs. However, very large firms can experience diseconomies of scale from issues like poor communication and inefficient divisions of labor. While large firms benefit from economies of scale in industries with high capital costs, small businesses can still compete by focusing on niche markets or those requiring little capital. Moderation is often the best approach with economies of scale.
Three small businesses are described that started with little funding and grew successfully. Domino's Pizza was started in 1960 by Tom Monaghan with $500 and now generates $1 billion in annual sales. Jeremy's MicroBatch Ice Cream makes small-batch ice cream and averages over $1 million in annual sales after two years. Glow Dog, Inc. sells reflective dog clothing and also averages over $1 million in annual sales after two years. All three businesses were started with entrepreneurial ideas and little initial investment.
This document provides an overview of business foundations concepts for students in an AGC450 course. It discusses the key participants in a business, the functional areas of business, and external forces that influence business activities. It also defines economics and the factors of production, and covers the basics of supply and demand, including how equilibrium price is determined by the interaction of supply and demand in a free market system. Key terms related to competition and different market structures are also introduced.
This document provides an overview of different forms of business organization, including sole traders, partnerships, private limited companies, and public limited companies.
1) Sole traders are the most common form of business and are owned and run by one person, but they have unlimited liability and limited financing options.
2) Partnerships involve 2-20 people who jointly own and operate a business through a partnership agreement, sharing both profits and unlimited liability.
3) Private limited companies have separate legal identities from their owners and allow owners to sell shares with limited liability, but shares cannot be freely sold without consent.
4) Public limited companies can sell shares to the public, allowing them to potentially raise unlimited capital, but
This document discusses economies and diseconomies of scale. It explains that economies of scale are factors that cause average unit costs to fall as output increases, while diseconomies of scale cause average costs to rise with increased output. The document provides examples of economies of scale like bulk buying and technical efficiencies. It also discusses potential diseconomies like poor employee motivation, communication, and managerial coordination issues that can arise in large firms. Overall, it analyzes how both economies and diseconomies can impact costs as businesses grow.
IGCSE Business Studeies Unit 1 understanding business activity pptIrshad Tunio
1. Businesses produce goods and services to satisfy peoples' unlimited wants using limited resources. This leads to scarcity.
2. Specialization and division of labor are used to make the most efficient use of limited resources in production. Workers specialize in specific tasks to increase output.
3. Businesses have objectives like profit, growth, and survival that sometimes conflict with stakeholder objectives like customer satisfaction, employment, and environmental protection.
The document discusses business and industry. It defines business as an activity involving production and exchange of goods and services to earn profit. It also defines industry as the production aspect of business that uses natural resources and human labor to create useful goods. The key characteristics of business discussed are that it is an economic activity, involves buying and selling, is a continuous process, aims to earn profit while accepting risk, focuses on customer satisfaction, and is creative, dynamic, and subject to government controls. It also outlines different types of industries like primary, extractive, manufacturing, construction and more.
1. An entrepreneur organizes and operates a new business venture, taking on risks to produce goods or services. A business plan documents business objectives, operations, finance, and ownership to help obtain loans and guide the business.
2. Businesses want to grow internally through new branches or externally through mergers and acquisitions to benefit from economies of scale, increased market share, and access to new markets. However, growth brings challenges like difficulty controlling larger operations.
3. Not all businesses grow - some stay small due to factors like their industry, market size, or owners' objectives. New businesses are also at high risk of failure due to lack of experience, understanding of the market, sales, and financial resources compared
The document discusses the various objectives of a firm, including:
1) Profit maximization, which aims to generate the highest profits for shareholders.
2) Sales maximization, which focuses on selling as much output as possible while earning normal profits.
3) Revenue maximization, which occurs when marginal revenue from additional sales is zero.
4) Managers may also pursue objectives like increasing market share, firm size, or their own utility through salaries and perks.
The document provides an introduction to key concepts in economics, including:
1) Economics involves making choices due to scarce resources and unlimited wants. It studies how individuals and societies make decisions about production, consumption, and distribution.
2) The four factors of production are land, labor, capital, and entrepreneurship. Goods and services are produced using these factors.
3) Individuals and societies face trade-offs in how they use limited resources to fulfill needs and wants. Opportunity cost is the value of the next best choice not taken.
The document summarizes a proposed detergent soap manufacturing business in India. [1] The company will be located in Patrapada, Bhubaneswar and will produce detergent soap cakes that can be used by hand or in soft water. [2] The startup will require Rs. 16,80,000 in capital, with Rs. 10,00,000 coming from a loan and Rs. 6,80,000 from the founders. [3] The aim is to distribute the product throughout India by expanding distribution channels.
This document provides an introduction to microeconomics and macroeconomics. It defines key microeconomic concepts such as scarcity, opportunity costs, marginal costs and benefits, and exchange. It also defines macroeconomics and discusses positive and normative statements. Microeconomics examines individual units like households and firms, while macroeconomics looks at aggregate markets and the overall economy. Models discussed include the circular flow diagram and the production possibilities frontier.
This document provides an analysis of Topshop's marketing strategies. It begins with background on Topshop and its focus on trends and sustainability. It then performs a PESTEL analysis identifying political, economic, social, technological, environmental, and legal factors affecting the business. These include Brexit, economic uncertainty lowering consumer spending, growth of online retailers and supermarkets, increasing consumer power through technology, environmental backlash against fast fashion, and legal regulations. A SWOT analysis identifies Topshop's strengths in brand recognition and sustainability initiatives, weaknesses in lack of innovation, opportunities in international expansion, and threats from online competitors and changing trends. Market trends, target markets, competitors, and marketing objectives, strategies, and programs are also analyzed to guide Top
The document provides an introduction to economics. It discusses [1] how economics deals with scarce resources and unlimited wants, posing problems of what, how, and for whom to produce goods and services, [2] the different types of resources including land, labor, capital, and entrepreneurial talent, and [3] some objectives and pitfalls of economic reasoning including efficiency, equity, and avoiding logical fallacies.
The document provides an introduction to economics. It discusses [1] how economics deals with scarce resources and unlimited wants, posing problems of what, how, and for whom to produce goods and services, [2] the different types of resources including land, labor, capital, and entrepreneurial talent, and [3] some objectives and pitfalls of economic reasoning including efficiency, equity, and avoiding logical fallacies.
This document provides an overview of different economic systems and concepts related to resource allocation. It discusses key terms, the role of private firms and consumers in market economies, how the price mechanism works, potential market failures, and ways governments can intervene in mixed economies to address failures. Examples are given of different countries that have more market-based, mixed, or planned economic systems. Students are prompted to discuss topics and complete activities in pairs or groups.
The document discusses four main theories of motivation:
1) Taylor's theory that money is the primary motivator and paying employees more will increase productivity. However, this view does not consider non-financial motivators.
2) Maslow's hierarchy of needs which identifies physiological, safety, social, esteem, and self-actualization needs that motivate employees. Meeting lower level needs allows higher needs to motivate.
3) Herzberg's hygiene factors like salary and working conditions prevent demotivation, while motivational factors like achievement and recognition provide true motivation.
4) McGregor's Theory X and Y, where Theory X managers believe external incentives motivate employees and Theory Y managers believe a favorable environment
This document provides information about marketing, including defining marketing, discussing the role of marketing in businesses, and distinguishing between mass markets and niche markets. It defines marketing as "the management process of anticipating, understanding and satisfying customer needs at a profit." The role of marketing is identified as activities like identifying and satisfying customer needs, maintaining customer loyalty, and anticipating changes in customer needs. Mass markets aim to create widely appealing generic brands, while niche markets tailor products to specific customer segments.
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This document discusses the economic problem of unlimited wants and limited resources. It explains that the scarcity of resources requires people and societies to make choices about how to allocate resources. Businesses help address this problem by combining factors of production like land, labor, capital and enterprise to produce goods and services that satisfy people's wants. Specialization of labor improves the efficiency of resource use. The document provides examples of goods and services at a supermarket to illustrate the concepts.
This document discusses key concepts in business studies including:
1. The economic problem arises from limited resources and unlimited wants, creating scarcity and requiring choices about resource allocation.
2. The four factors of production are land, labor, capital, and enterprise. Specialization allows for more efficient use of these limited resources.
3. Businesses combine the factors of production to make goods and services that satisfy wants and needs.
This chapter discusses how economies of scale can lead to international trade even when countries are identical. It provides an example where concentrating widget production in one country allows both countries to consume a variety of goods through trade, taking advantage of larger scale of production. There are two types of economies of scale - external, which apply at the industry level, and internal, which apply at the firm level. External economies can arise from specialized suppliers, labor market pooling, and knowledge spillovers between firms. The chapter focuses on external economies and how they can encourage trade by allowing industries to cluster in certain locations.
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Economies of scale refers to decreased per-unit costs as production increases. As a firm produces more, average costs fall due to efficiencies from mass production and distribution of initial capital costs. However, very large firms can experience diseconomies of scale from issues like poor communication and inefficient divisions of labor. While large firms benefit from economies of scale in industries with high capital costs, small businesses can still compete by focusing on niche markets or those requiring little capital. Moderation is often the best approach with economies of scale.
Three small businesses are described that started with little funding and grew successfully. Domino's Pizza was started in 1960 by Tom Monaghan with $500 and now generates $1 billion in annual sales. Jeremy's MicroBatch Ice Cream makes small-batch ice cream and averages over $1 million in annual sales after two years. Glow Dog, Inc. sells reflective dog clothing and also averages over $1 million in annual sales after two years. All three businesses were started with entrepreneurial ideas and little initial investment.
This document provides an overview of business foundations concepts for students in an AGC450 course. It discusses the key participants in a business, the functional areas of business, and external forces that influence business activities. It also defines economics and the factors of production, and covers the basics of supply and demand, including how equilibrium price is determined by the interaction of supply and demand in a free market system. Key terms related to competition and different market structures are also introduced.
This document provides an overview of different forms of business organization, including sole traders, partnerships, private limited companies, and public limited companies.
1) Sole traders are the most common form of business and are owned and run by one person, but they have unlimited liability and limited financing options.
2) Partnerships involve 2-20 people who jointly own and operate a business through a partnership agreement, sharing both profits and unlimited liability.
3) Private limited companies have separate legal identities from their owners and allow owners to sell shares with limited liability, but shares cannot be freely sold without consent.
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IGCSE Business Studeies Unit 1 understanding business activity pptIrshad Tunio
1. Businesses produce goods and services to satisfy peoples' unlimited wants using limited resources. This leads to scarcity.
2. Specialization and division of labor are used to make the most efficient use of limited resources in production. Workers specialize in specific tasks to increase output.
3. Businesses have objectives like profit, growth, and survival that sometimes conflict with stakeholder objectives like customer satisfaction, employment, and environmental protection.
The document discusses business and industry. It defines business as an activity involving production and exchange of goods and services to earn profit. It also defines industry as the production aspect of business that uses natural resources and human labor to create useful goods. The key characteristics of business discussed are that it is an economic activity, involves buying and selling, is a continuous process, aims to earn profit while accepting risk, focuses on customer satisfaction, and is creative, dynamic, and subject to government controls. It also outlines different types of industries like primary, extractive, manufacturing, construction and more.
1. An entrepreneur organizes and operates a new business venture, taking on risks to produce goods or services. A business plan documents business objectives, operations, finance, and ownership to help obtain loans and guide the business.
2. Businesses want to grow internally through new branches or externally through mergers and acquisitions to benefit from economies of scale, increased market share, and access to new markets. However, growth brings challenges like difficulty controlling larger operations.
3. Not all businesses grow - some stay small due to factors like their industry, market size, or owners' objectives. New businesses are also at high risk of failure due to lack of experience, understanding of the market, sales, and financial resources compared
The document discusses the various objectives of a firm, including:
1) Profit maximization, which aims to generate the highest profits for shareholders.
2) Sales maximization, which focuses on selling as much output as possible while earning normal profits.
3) Revenue maximization, which occurs when marginal revenue from additional sales is zero.
4) Managers may also pursue objectives like increasing market share, firm size, or their own utility through salaries and perks.
The document provides an introduction to key concepts in economics, including:
1) Economics involves making choices due to scarce resources and unlimited wants. It studies how individuals and societies make decisions about production, consumption, and distribution.
2) The four factors of production are land, labor, capital, and entrepreneurship. Goods and services are produced using these factors.
3) Individuals and societies face trade-offs in how they use limited resources to fulfill needs and wants. Opportunity cost is the value of the next best choice not taken.
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This document provides an introduction to microeconomics and macroeconomics. It defines key microeconomic concepts such as scarcity, opportunity costs, marginal costs and benefits, and exchange. It also defines macroeconomics and discusses positive and normative statements. Microeconomics examines individual units like households and firms, while macroeconomics looks at aggregate markets and the overall economy. Models discussed include the circular flow diagram and the production possibilities frontier.
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This document provides an overview of different economic systems and concepts related to resource allocation. It discusses key terms, the role of private firms and consumers in market economies, how the price mechanism works, potential market failures, and ways governments can intervene in mixed economies to address failures. Examples are given of different countries that have more market-based, mixed, or planned economic systems. Students are prompted to discuss topics and complete activities in pairs or groups.
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The document discusses four main theories of motivation:
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3) Herzberg's hygiene factors like salary and working conditions prevent demotivation, while motivational factors like achievement and recognition provide true motivation.
4) McGregor's Theory X and Y, where Theory X managers believe external incentives motivate employees and Theory Y managers believe a favorable environment
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The document discusses the three sectors of industry: primary, secondary, and tertiary. The primary sector involves extraction of natural resources, such as farming, fishing, and forestry. The secondary sector involves manufacturing goods from raw materials provided by the primary sector, such as aircraft making and clothes manufacturing. The tertiary sector provides services to both consumers and businesses, including transportation, banking, hotels, and hairdressing. Developing countries tend to engage more in primary industries while developed countries employ more people in secondary and tertiary sectors. Most countries have mixed economies with both private and public sectors.
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In Odoo, making a field required can be done through both Python code and XML views. When you set the required attribute to True in Python code, it makes the field required across all views where it's used. Conversely, when you set the required attribute in XML views, it makes the field required only in the context of that particular view.
ISO/IEC 27001, ISO/IEC 42001, and GDPR: Best Practices for Implementation and...PECB
Denis is a dynamic and results-driven Chief Information Officer (CIO) with a distinguished career spanning information systems analysis and technical project management. With a proven track record of spearheading the design and delivery of cutting-edge Information Management solutions, he has consistently elevated business operations, streamlined reporting functions, and maximized process efficiency.
Certified as an ISO/IEC 27001: Information Security Management Systems (ISMS) Lead Implementer, Data Protection Officer, and Cyber Risks Analyst, Denis brings a heightened focus on data security, privacy, and cyber resilience to every endeavor.
His expertise extends across a diverse spectrum of reporting, database, and web development applications, underpinned by an exceptional grasp of data storage and virtualization technologies. His proficiency in application testing, database administration, and data cleansing ensures seamless execution of complex projects.
What sets Denis apart is his comprehensive understanding of Business and Systems Analysis technologies, honed through involvement in all phases of the Software Development Lifecycle (SDLC). From meticulous requirements gathering to precise analysis, innovative design, rigorous development, thorough testing, and successful implementation, he has consistently delivered exceptional results.
Throughout his career, he has taken on multifaceted roles, from leading technical project management teams to owning solutions that drive operational excellence. His conscientious and proactive approach is unwavering, whether he is working independently or collaboratively within a team. His ability to connect with colleagues on a personal level underscores his commitment to fostering a harmonious and productive workplace environment.
Date: May 29, 2024
Tags: Information Security, ISO/IEC 27001, ISO/IEC 42001, Artificial Intelligence, GDPR
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Exploiting Artificial Intelligence for Empowering Researchers and Faculty, In...Dr. Vinod Kumar Kanvaria
Exploiting Artificial Intelligence for Empowering Researchers and Faculty,
International FDP on Fundamentals of Research in Social Sciences
at Integral University, Lucknow, 06.06.2024
By Dr. Vinod Kumar Kanvaria
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This presentation includes basic of PCOS their pathology and treatment and also Ayurveda correlation of PCOS and Ayurvedic line of treatment mentioned in classics.
This presentation was provided by Steph Pollock of The American Psychological Association’s Journals Program, and Damita Snow, of The American Society of Civil Engineers (ASCE), for the initial session of NISO's 2024 Training Series "DEIA in the Scholarly Landscape." Session One: 'Setting Expectations: a DEIA Primer,' was held June 6, 2024.
This slide is special for master students (MIBS & MIFB) in UUM. Also useful for readers who are interested in the topic of contemporary Islamic banking.
2. You would much rather be by the sea, lounging on this
exceptional chair and drinking an ice cold smoothie…
How many different stages came about to bring this
exceptional chair to life?
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4. … You will notice that there are three main stages of activity.
Primary
Forestry
Secondary
Making Furniture
Tertiary
Retailer
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5. Farming Fishing Forestry Extraction of
natural
resources
The primary sector of industry extracts and uses the natural
resources of the earth.
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7. Transportation Hotels Hairdressers Banking
The tertiary sector of industry involves providing services to
both consumers and other businesses. Activities in the
tertiary sector include transport, banking, insurance, hotels
and hairdressing.
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8. Every country is unique.. Therefore the term ‘important’ is
relative to the needs of each individual country.
The three sectors of industry are compared by
The number of workers employed in
each sector
The value of output of the goods and
service
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9. Country Primary Secondary Tertiary
United Kingdom 2 20 78
China 44 24 32
Ghana 54 20 26
As a general rule of thumb: developing countries tend to engage in more primary
Sector industries.
Most people live in the rural areas with low incomes.
Therefore, there is little demand for services such as transport, hotels and insurance.
While comparing countries, differences might occur…
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10. In developed countries…
o Manufacturing started long ago
o Secondary and tertiary sectors are employed more
o Level of output in the primary sector is lower.
o In very wealthy countries, it is common that they export the
manufactured goods from abroad.
o Most of the workers will be employed in the tertiary sector for
services.
o This process is called de-industrialization. It occurs when there is a
decline in the importance of the secondary, manufacturing, sector
in a country.
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11. All countries suffer from the problem of scarce resources!
To solve this problem, they use one of three economic
systems:
1. Free Market Economy
2. Command or Planned Economy
3. Mixed Economy
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12. I. Features
o All resources are owned privately
o No government control over land, capital and labour
o Businesses produce to make a profit
o Goods in high demand: Are more profitable and so are
produced more.
o Goods in low demand: Are less profitable and so are
produced less.
o Prices of goods are therefore influenced by the demand
and supply of those goods.
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13. II. Advantages
Consumers are free to choose
what they want to buy.
Workers are encouraged to work
hard because:
1. They keep most of their
incomes
2. Taxes are very low
Competition among businesses
keeps prices low.
New businesses are encouraged
to set up in order to make
profits.
III. Disadvantages
Government doesn’t provide
public services and so…
o Only those who can afford it
will benefit (education,
health, transportation).
Government doesn’t plan or
control the economy and so…
o There can be many
uncontrolled booms and
recessions.
Businesses might be
encouraged to create
monopolies in order to control
all of the market for a product
and increase prices.
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14. There is no country with a completely free market system. In
all countries, governments are involved in important
economic decisions, to a greater or lesser degree.
The USA is the closest example to a free market economy
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15. I. Features
o Combines some features of both a free market economy
and a command economy.
o Nearly every country in the world has a mixed economy
with both a private sector and a public sector.
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16. II. Private Sector
Comprised of businesses not
owned by the government.
The businesses will decide
about what to produce, how it
should be produced and what
price should be charged for it.
Most businesses aim to run for
profit.
III. Public Sector
Made up of government or state
owned and controlled
businesses and organizations.
The government makes
decisions about what to produce
and how much to charge
consumers.
Some goods and services are
provided free of charge to the
consumer such as health and
education services.
The money comes from taxes.
Service to the community is the
main objective.
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17. Free Market Economy
All resources are owned by the private sector. Profit
motive is very important.
Command or Planned Economy
All resources owned and controlled by the state
Mixed Economy
Private Sector: Some private ownership and control.
Public Sector: Some state ownership and control.
Revision Summary
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18. Should the government own and control less than it does?
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19. Privatisation is when
governments have sold off
businesses they previously
owned to new owners in the
private sector.
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20. The new private owners are now aiming
for profit. This increases efficiency.
Competition may now be encouraged if
the business is sold off to a variety of
private owners. This helps to increase
efficiency and so will keep prices low.
Governments are often short of money.
New owners will invest additional capital
to improve the services.
Important business decisions will now
be made for reasons of business
efficiency– not by government
popularity.
Sales of the public sector businesses
raises money for the government for
other services.
Arguments for
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21. As the new owners are interested
mainly in profits, some services making
losses may be closed. These might be
disturbing to members of the
community.
Workers jobs could be lost as the new
owners attempt to increase efficiency in
order to raise profits.
The business might be sold off to one
owner who would still be able to run it
as a monopoly. This could lead to
higher prices for the customers.
Only a few people – the new owners –
will benefit from owning the business,
whereas public services allow the entire
community to benefit.
Arguments
against
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23. Businesses can vary greatly in terms of size
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24. Who would find it useful to compare the size of
businesses?
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25. •Before deciding
which business to
put their savings
into.
Investors
•Different tax
rates for small
and large
businesses.
Governments
•Compare the size
and importance
with other firms.
Competitors
•To have some
idea if how many
people they’ll be
working with.
Workers
•To see how
important a loan
to the business
is compared to
its overall size
Banks
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27. Rule of thumb is
that the bigger the
business, the higher
the number of
employees.
HOWEVER… Some
firms use production
methods which
employ very little
employees. These
firms are called
capital intensive
firms.
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28. Rule of thumb is
that we compare
businesses of the
same industry to
see who’s products
are sold the most.
HOWEVER… a very
profitable firm might
be employing very
few employees.
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29. Rule of thumb is
that we compare the
total amount of
capital invested in
the business.
HOWEVER… a
company may use
labour-intensive
methods of
production to give
low output and use
little capital
equipment.
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30. THIS IS NOT AN ACCURATE WAY OF COMPARING THE
SIZE OF FIRMS.
HOWEVER… it can be used as a measurement of
efficiency when compared with the other methods,
to justify employing certain techniques.
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32. Growth (expansion) is one of the main objectives of a
business.
Advantages of growth include:
Owners: Possible higher profits.
Owners and Managers: More status and
prestige as well as salaries to the managers.
Economies of scale (chapter 6)
Controls larger share of the market (higher
sales), creates more influence when dealing
with suppliers and distributers
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33. Businesses can expand in two main ways
• For example: a restaurant owner opening
other branches of the same restaurant in
other parts of town.
• Existing profits are regenerated for this kind
of growth.
Internal Growth
• Involving a Takeover or Merger with another
business
External Growth
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34. Horizontal Merger (Horizontal Intergration) is when one firm
merges with or takes over another one in the same industry at
the same stage of production.
For example:
• Glaxo Wellcome and Smithkline Beecham were two
individual pharmaceutical companies that merged to
become Glaxo Smithkline.
• Sony and Ericsson were two high-tech electronics
companies that merged to become Sony Ericsson.
• Daimler-Benz (Mercedes) and Chrysler are two automotive
companies that merged to become Daimler-Chrysler.
External Growth:
1.Horizontal Merger
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35. Advantages include
The number of competitors is reduced
There are opportunities for economies of scale
The combined businesses will have a bigger
share of the total market than either firm before
the integration
External Growth:
1.Horizontal Merger
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36. Vertical Merger (Vertical Intergration) is when one firm
merges with or takes over another one in the same industry
but at a different stage of production.
It could be:
• Forward: When a firm integrates with another firm at
a later stage of production (closer to the consumer)
• Backward: When a firm integrates with another firm
at an earlier stage of production (closer to the raw
materials)
External Growth:
2.Vertical Merger
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37. For example:
• Coal Mine
• Copper Wire Maker
• Electrical Contractor
• Real life example: ExxonMobil was initially Exxon (oil
refinery) and Mobil (sale of oil refined products) that
now form the #1 Forbes 2012 company worth $828
billion.
External Growth:
2.Vertical Merger
Forward
Integration
Backward
Integration
Raw
materials
Consumers
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38. Assume that a car manufacturer takes over a car retailing
business
Advantages include:
The merger gives an assured outlet for their product
The profit margin made by the retailer is absorbed
by the expanded business
The retailer could be prevented from selling
competing makes of car
Information about consumer needs and preferences
can now be obtained directly by the manufacturer
External Growth:
2.Forward Vertical Merger
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39. Assume that a car manufacturer takes over a firm supplying car
body panels
Advantages include:
The merger gives an assured supply of important
components
The profit margin of the supplier is absorbed by the
expanded business
The supplier could be prevented from supplying
other manufacturers
Costs of components and supplies for the
manufacturer could be controlled.
External Growth:
2.Backward Vertical Merger
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40. Conglomerate Merger (Conglomerate Intergration) is when
one firm merges with or takes over another one in a
completely different industry. This is also known as
diversification.
For example:
• General Electric over the years has merged and
acquired a number of businesses to have expanded
in many fields such as electronics, food products,
medical technology products, etc.
External Growth:
3.Conglomerate Merger
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41. Advantages include
Spreading the risks over several activities
Transfer of ideas between the different sections helping
employees and managers to look outside the box.
External Growth:
3.Conglomerate Merger
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43. Not all businesses grow… some stay
small (employ relatively fewer people
and use relatively smaller amounts of
capital)
There are several reasons for this…
1. The type of industry the
business operates in
2. The market size
3. The owners’ objective
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44. Some businesses offer personal services or specialized
products…
If they were to grow too large, they would find it difficult to
offer the close and personal service demanded by the
consumers.
For example…
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45. If the market – the total number of customers – is small,
then the business is likely to remain small.
For example…
Shop
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46. Some business owners prefer to keep things small and
simple. They run a cozy business that they are in control of,
know all of their employees and wish to avoid the added
stress of running a larger firm.
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48. The government of country A has recently collected data concerning the
business sectors of the country. Table 1 shows this data.
GDP measures the value of the total output produced in a country in one year.
In 2004 the GDP of country A was $1800m.
The number of employees in country A in 2004 was 15m.
2 marks
Sector % of total
employment
% of total GDP
Primary 50 30
Secondary 40 45
Tertiary 10 25
Table 1
Table 2
Number of Employees % of businesses
Less than 10 40
10-100 45
Greater than 100 15
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49. a) Using Table 1 calculate:
i. The number of people employed in Tertiary activities.
Number of people employed in Tertiary activities = Total number * Percentage of
total employment
Number of people employed in Tertiary activities = 15m*10% = 1.5 m people.
ii. The value of the output of the Primary sector of the economy.
Value of output in Primary sector = Total GDP* Percentage of total GDP
Number of people employed in Tertiary activities = $1800m*30% = $540 m
2 marks
Sector % of total
employment
% of total GDP
Primary 50 30
Secondary 40 45
Tertiary 10 25
Table 1
2 marks
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50. b) Table 2 shows the size of businesses by the number of people employed. Is
using the number of employees to measure business size the best method?
Explain your answer.
4 marks
Table 2
Number of Employees % of businesses
Less than 10 40
10-100 45
Greater than 100 15
As a rule of thumb, when we measure businesses using the number of people
employed, the larger business will have the higher number of employees or
labour force. The opposite is also, nevertheless true. This may be misleading
since some businesses are capital intensive which means that they rely more on
machinery that can replace the presence of actual people. The machines allow
these businesses to have an increase in productivity, become more efficient and
hence need less laborers. This does not necessarily make them small in size.
Therefore, we cannot rely on number of employees only as a rule since there are
other factors such as the capital invested and value of the sales and output.
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51. Mirex is a large company that sells a range of insurance policies to
businesses and the general public. The market for insurance is very
competitive and Mirex are always looking for ways to cut their costs.
Recently they have invested heavily in new technology.
a) Mirex has been described as a large company. State three ways of
measuring the size of a business.
1. By measuring the number of employees in a business.
2. By measuring the value of the output and sales.
3. By measuring the capital invested in the business.
b) What sector of business activity does Mirex operate in. Explain your
answer.
Mirex operates in the tertiary sector. This is because they sell
insurance which is a service that they provide to businesses and the
general public. Services are part of the tertiary sector.
2 marks
3 marks
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52. Country X has a mixed economy. It also has businesses in the primary,
secondary and tertiary sectors.
a) Give an example of a business in:
i. The primary sector: fishing, farming, mining. (mention only one).
ii. The tertiary sector: insurance, banking, hotel services (mention only one)
b) Explain what is meant by the term ‘mixed economy’.
A mixed economy combines some features of a free market economy (no
government interference) and a command economy (government controls the
decision-making).
A mixed economy has two sectors working together for the overall benefit
of the community. There is the public sector which consists of government or state
aimed businesses with the primary aim of providing a service to the community and
consumers. This may include transportation systems, public school and public
hospitals as well as police systems.
The private sector includes businesses not owned by the government
which make their own decisions about what to produce, how to produce it and the
selling price. The main aim for these businesses is to make a profit.
4 marks
1 mark
1 mark
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53. a) Use the data given in Fig. 1,
i. State the % of workforce employed in primary activities in 2000.
10%
1 mark
0 5 10 15 20 25 30 35 40 45 50 55 60
Tertiary
Secondary
Primary
2000
2001
% of workforce
Total workforce
= 25 million in both years
Fig. 1
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54. a) Use the data given in Fig. 1,
ii. Calculate the number of people employed in tertiary activities in 2001.
Number of ppl in tertiary act. in 2001 = Total workforce * % of tertiary act. in 2001
= 25m * 55%
= 13.75 m people
b) Explain why, in many countries, the percentage of the workforce employed in
tertiary activities is increasing.
The tertiary sector is concerned with the services industry. This includes
insurance, hotels, restaurants and the banking sector. As the economic activities
increases in many countries, the standard of living will rise in that country for the
people. When this happens, most of the basic needs will be met and the consumers
will start piling up their wants lists. Consumers will start looking for more luxurious
services and products to satisfy those wants, which opens up the room for
industries in the tertiary sector to set up and supply those demands.
2 marks
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55. c) Two large drink manufacturing companies have just merged creating a monopoly.
i. What is meant by a monopoly?
A monopoly is a business which controls all of the market for a product. In this
case, when the two drink companies have merged, they eliminated each others’
competition causing them to join forces and become one company controlling this
market.
ii. Explain what advantages the companies would expect to gain from this merger.
This type of merger is a horizontal merger because it takes place with
industries in the same stage of production. The merger has reduced the number of
competitors in the market. Instead of the two large firms competing with each other,
they are joining forces to become one large company that will benefit from the profits of
all the products. They will be producing at a lower cost as well since they will take
advantage of the economies of scale. The new business will have a higher market
share, higher control over the market and so again will have achieved its profit and
growth objectives.
2 marks
4 marks
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56. c) A market economy exists in many countries. Identify the main features of such
a system.
A market economy is one where the resources are owned by the private
sector. There is no government control over the land, labor or the capital. The main
objectives of businesses in a market economy is to produce profits. Decisions of
what to produce and what services to supply in the markets are a result of the
demand placed by the consumers. The higher the demand, the more profitable the
business and so the higher the production and investment.
Consumers have a lot of options to choose from since this type of market
encourages many business owners to set up their businesses there, since there are
little or no taxes to be paid leading to higher profits.
The main concern of a market economy is that the complete absence of
governmental control can lead to monopolies, unplanned recessions and booms as
well as unregulated market activity. Also, services that are essential for individuals
such as health care and education are only available to those who can afford it.
4 marks
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57. In some countries a number of state owned businesses have been sold to the
private sector (privatisation). State and explain two possible disadvantages to
consumers of this.
The main disadvantage of privatisation is that the objectives of the private
sector are not the same as those of the public sector. The private sector is more
concerned with making a profit while the public sector is more concerned with
providing a service to the community. Decision-making will therefore take a
different approach since the new private sector company will cut down on losses to
maximize profits via shutting down services, letting workers go and increasing
prices.
Another disadvantage is that the business might be sold to one private
investor who can turn it into a monopoly. A monopoly can take place when one
business is in control of the majority of shares of the market. This will not benefit
consumers since prices will rise and the absence of competition will not guarantee
the maintenance of quality.
4 marks
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58. Table 1 gives employment data for country A over the last 10 years.
a) Calculate the number of people employed in secondary business activities in
2002.
No. of ppl in Secondary Business in 2002 = Total labour force * % of secondary act
= 84m*40% = 33.6 m people 2 marks
1993 2002
% of labour force
employed in
Primary Sector 21 14
Secondary Sector 45 40
Tertiary Sector 30 41
Unemployed as % of
labour force
4 5
Labour force (millions) 80 84
Employment data for country A 1993-2002
Table 1
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59. b) Outline two possible reasons to explain the changes in the pattern of
employment between 1993 and 2002 in country A.
As countries move from becoming developing to developed countries, they start
moving their activities from the primary and secondary industries and into the
tertiary sector. This is because the standard of living of the people has increased
which has caused most of their needs to be met. This allows demand for the
tertiary sector services to increase, becoming more profitable for businesses and
so the shift in sectors takes place.
De-industrialization takes place in the secondary sector, which is a decline in the
importance of the manufacturing sector of industry. Countries can start exporting
goods needed from the primary and secondary sectors now as their countries are
becoming wealthier. This allows them to focus on the tertiary services and increase
the activities to meet the demands of the consumers.
4 marks
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