Business CH 2

• Sectors: There are 3 sectors: primary, secondary, tertiary. 
• Key words: Primary - extract, Secondary - manufacturing, Tertiary - services
• Primary sector - farming, fishing, forestry and the extraction of natural materials, such as oil and copper ore.
• Secondary sector - building and construction, aircraft and car manufacturing, computer assembly, baking.
• Tertiary sector - industry include transport, retail, insurance, hotels and hairdressing.
• Privatisation: The main objective of organisations in the public sector is to provide public services, whereas organisations in the private sector aim to earn profits.
• Private sector:

  • Businesses not owned by the government
  • Make their own decisions about what to produce, how it should be produced, and what price should be charged
  • Aim to make a profit
• Public sector:

  • Businesses owned and controlled by the government
  • The government or other public sector authority makes decisions about what to produce and how much to charge consumers
  • Some goods and services are provided free of charge to the consumer, such as state health and education services
  • The money for these services comes from the taxpayer, not the user
• In many countries the government controls the following important industries or activities (for public companies) :

  • health
  • education
  • defence
  • public transport
  • water supply
  • electricity supply
• De-industrialisation: De-industrialusation occurs when there is a decline in the importance of the secondary, manufacturing sector of industry in a country.

  Mixed economy: A mixed economy has both a private sector and a public (state) sector.

  Capital: Capital is the money invested into a business by the owners.