PDF Notes: commerce final t1

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    What is production?

    Converts resources into goods or services.

    What defines consumer goods?

    Purchased to satisfy individual needs and wants.

    How do capital goods differ from consumer goods?

    Used to produce other goods and services.

    What are direct services?

    Aimed directly at consumers.

    What is the role of land in production?

    Location for business premises.

    What is the impact of division of labour on productivity?

    Increases efficiency by assigning specific tasks.

    What are the advantages of specialization for workers?

    Becoming experts and potentially earning more.

    What happens if a specialist worker is absent?

    Production may be disrupted.

    What are the advantages of buying from local suppliers?

    Lower transport costs and quicker order processing.

    What is a disadvantage of buying from foreign suppliers?

    Longer delivery times and potential language barriers.

    What are transaction costs?

    Costs incurred during the exchange of goods.

    What is the significance of the memorandum of association?

    Details the company's name and objectives.

    How do private limited companies differ from public limited companies?

    Shares are not sold on the stock market.

    What is a franchise?

    A business model allowing operators to trade under a brand.

    What are the implications of public ownership of businesses?

    Accountable to the public and funded by taxes.

    What is the purpose of privatisation?

    Transfer public resources to the private sector.

    What are the functions of retailers?

    Buying, storing, selling, and providing credit.

    What is a street market?

    Location where small traders sell goods from stalls.

    What are the disadvantages of independent retailers?

    Limited range and higher prices.

    What is the advantage of department stores?

    Offer a large range of goods in one location.