1 IB Business Management: 1.1 Introduction to Business Management Questions and Answers ( Rated A)

1 IB Business Management: 1.1 Introduction to Business Management Questions and Answers ( Rated A) Quaternary Sector - ANS- A subset of the tertiary sector and involves service jobs concerned with research and development, management and administration, and processing and disseminating information. Intrapreneurship - ANS- The act of behaving like an entrepreneur while working within a large organization where freedom and financial support is given to create new products, services, systems, etc. Consumer Goods - ANS- The physical and tangible goods sold to the general public. They include cars and washing machines, which are referred to as durable consumer goods. Non-durable consumer goods include food, drinks and sweets that can only be used once Consumer Services - ANS- Non-tangible products that are sold to the general public and include hotel accommodation, insurance services and train journeys Capital Goods - ANS- Physical goods that are used by an industry to aid in the production of other goods and services, such as machines and commercial vehicles Factors of Production - ANS- Resources needed by businesses to produce goods or services The Factors of Production - ANS- Land, Labour, Capital and Enterprise Land - ANS- Natural resources that can be found on the planet. This includes renewable and nonrenewable natural resources such as water, wood, fish and physical land itself Labour - ANS- The physical and mental human effort used in the production process Capital - ANS- The finance needed to set up a business and pay for its continued operations or expansion. Also includes the man-made goods used in the production process (capital goods) Enterprise - ANS- Risk taking individuals who combine the other factors of production into a unit that is capable of producing goods and services. It provides a managing, decision-making and coordinating role Business Functions - ANS- Marketing, Finance, Human Resource Management and Operations Management Marketing - ANS- The commercial processes involved in creating and designing, promoting and selling and distributing a product or service Finance - ANS- The management of money and credit and banking and investments Human Resource Management - ANS- The process of determining human resource needs and then recruiting, selecting, developing, motivating, evaluating, compensating, and scheduling employees to achieve organisational objectives Operations Management - ANS- The management of processes used to design, supply, produce, and deliver goods and services to customers Primary Sector Business Activity - ANS- Firms engaged in farming, fishing, oil extraction and all other industries that extract natural resources so that they can be used and processed by other firms Secondary Sector Business Activity - ANS- Firms that manufacture and process products from natural resources, including computers, brewing, baking, clothing and construction Tertiary Sector Business Activity - ANS- Firms that provide services or products to consumers and other businesses, such as retailing, transport, insurance, banking, hotels, tourism and telecommunications Businesses - ANS- Organizations that are involved in the production of goods and/or the provision of services Division of Labour - ANS- The specialization of workers in the provision of goods and/or services by breaking a job down into particular roles or components that are repeated by the same workers Entrepreneurs - ANS- People who manage, organise and plan the other three factors of production. They are risk takers who exploit business opportunities in return for profit Industrialization - ANS- The process experienced by a country that moves away from primary production towards manufacturing as its principal sector for national output and employment Opportunity Cost - ANS- Cost measured in terms of the next best alternative forgone when a choice is being made Private Sector - ANS- The part of the economy under the control of private individuals and businesses, rather than the government. Examples may include sole traders, partnerships and companies Public Sector - ANS- The part of the economy that is under control of the government. examples may include state health and education services, the emergency services and roading infrastructure Structural Change - ANS- A shift in the relative share of national output and employment that is attributed to each business sector; i.e. primary, secondary and tertiary sectors Value Added - ANS- Is the difference between a product's price and the total cost of the inputs that went into making it. It is the extra worth created in the production process Intrapreneur - ANS- An individual who behaves like an entrepreneur while working within a large organization which enables them to create new products, services, systems, etc