1. Welcome to IGCSE Business Studies
The Purpose of
Business Activity
Mr.Owen

2. Make a list of Your needs and wants What do You Notice?
A good or service to keep you
living
A good or service you would like
But is not essential

3. Learning Objectives To understand the ‘ECONOMIC PROBLEM’
To understand the FOUR FACTORS OF PRODUCTION
To understand the Three Sectors of Business Activity

4. Who are they? What do they have in common and what skills do they possess?

5. The Four Factors of Production (CELL)
CAPITAL - Money
ENTERPRISE – Entrepreneurial qualities
LAND – Raw Materials (Resources)
LABOUR - Workers

6. What Do These Four Factors Have in Common?
SCARCITY = THE ECONOMIC PROBLEM There are not enough resources to meet all needs and wants e.g. is this endless oil and gold? What will happen as these resources become scarcer?
All these factors are not infinite. Therefore:

7. Application Time
Read Nestle Case Study for Real Life Business scenario below this powerpoint on Haiku.

8. OPPORTUNITY COST
Because of SCARCITY businesses have to make choices. “THE BENEFITS GIVEN UP OF THE NEXT BEST CHOICE”

9. You only have enough money for One Option – Which one is your opportunity cost? Why?
Xbox 360
Playstation 3
Playstation Portable and 5 games
Nintendo Wii and Gamecube
Ninteno Wii and Nintendo DS

10. Specialisation & Division of Labour
Making the best use of limited resources
Breaking production down in to small tasks (DIVISION) and each worker becomes a specialist!
Click here for more info

11. What Have we Learnt? CELL Resources are scarce Opportunity cost
Specialistaion & Division of Labour

12. So How Did Richard Branson Start Out? Click Here
Businesses
Skills