Chapter 1 - Meanings 0.0 / 5 ? Business StudiesBusiness StudiesIGCSECIE Created by: 697Created on: 28-10-17 20:18 NEED A good or service essential for living. 1 of 9 WANT A good or service which people would like to have, but isn’t essential for living. People’s wants are unlimited. 2 of 9 ECONOMIC PROBLEM There exists unlimited wants but limited resources to produce the goods and services to satisfy those wants. This creates scarcity. 3 of 9 SCARCITY Lack of sufficient products to fulfill the total wants of the population. 4 of 9 OPPORTUNITY COST Next best alternative given up by choosing another item. 5 of 9 SPECIALISATION Occurs when people and businesses concentrate on what they are best at. 6 of 9 DIVISION OF LABOUR Production process is split up into different tasks and each worker performs one of these tasks. It’s a form of specialisation. 7 of 9 BUSINESSES Combine factors of production to make products (goods and services) which satisfy people’s wants. 8 of 9 ADDED VALUE Difference between the selling price of a product and the cost of bought in materials and components. 9 of 9
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