Economics 2.1

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Setting up a business 2.1
- Profit Motives
  - 1. Survival
    - 2. Profit
      - 3. Provide for family
        4. Increase Revenues
- Non-Profit Motives
- Social Enterprise
  - Individuals who benefit from running/working a social enterprise. Social enterprises are businesses with social aims.
  - Benefits:
    - 1. Provide employment for local people.
      - 2. People looking for a career change.
        3. People with learning difficulties
        4. Ex-offenders, disabled
- Adding Value
  - Changing a raw material to make it consumer ready e,g packaging
  - Adding Value represents the difference between the cost of material inputs and the eventual value of the product in terms of the price that can be changed for it.
    - Value added at each production stage:
      - Value Added = Value of Output - Value of Input
    - In order to produces, businesses need:
      - 1. LAND - e.g Buildings
        2. CAPITAL e.g money, equipment, machinery
        3. LABOUR e.g Human Resources, human capital.
        4. ENTERPRISE e.g Ideas
1. Be own boss
- 2. Work from home
  - 3. Help others
    - 4. Ethical reasons
- Non-Profit Motives
3. LABOUR e.g Human Resources, human capital.
- 4. ENTERPRISE e.g Ideas

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