IGCSE Business Chapter 1 and 2 Review

Why does scarcity exist?

• Each year workers tend to produce less than previously 
• Machines wear out in time
• There are not sufficient resources to meet everyone's wants
• There is a limit to people's wants 

Why will scarcity continue to be a problem in the future?

• Prices will rise
• Resources will always be finite 
• Needs will decrease in the future 
• World population will fall 

What factor of production's function is to make decisions and take risks?

• Capital
• Enterprise 
• Land 
• Labour 

What is meant by opportunity cost?

• The next best alternative foregone
• The cost of the item selected
• The cost of exploring business opportunities
• The labour used in producing the product 

A need is

• something we have to have in order to survive
• something we have to have to make our life better

A want is

• something we have to have in order to survive
• something we would like to have to make our life better

Which are not a factors of production

• land
• rent
• capital
• interest

 The difference between a good and a service is that:

• Goods are available in unlimited quantaties and services are not 
• Goods are tangible and services are not 
• Services are available in unlimited quantaties and goods are not 
• goods help satisfy unlimited wants and services do not

Which of the following is an example of PRIMARY business activity?

• Factories
• Shops
• Schools
• Farmers

Which of the following is an example of SECONDARY business activity?

• School
• Factories
• Shops
• Farmers