UNIT 2: CLASSIFICATION OF BUSSINESSES
STAGE OF ECONOMIC ACTIVITY
The primary sector of industry extracts and uses the natural resources of the earth to produce raw materials used by other businesses.
Example: forestry, coal mining...
The secondary sector of industry manufactures goods using the raw materials provided by the primary sector.
Example: computer assembly, bakery...
The tertiary sector of industry provides services to consumers and the other sectors of industry.
Example: insurance, travel agent, car showroom...
Example: forestry, coal mining...
The secondary sector of industry manufactures goods using the raw materials provided by the primary sector.
Example: computer assembly, bakery...
The tertiary sector of industry provides services to consumers and the other sectors of industry.
Example: insurance, travel agent, car showroom...
Usually the three sectors of the economy are compared by:
+ percentage of the country's total number of workers employed in each sector
+ value of output of goods and services and the proportion this is of total national output
+ percentage of the country's total number of workers employed in each sector
+ value of output of goods and services and the proportion this is of total national output
CHANGES IN SECTOR IMPORTANCE
De-industrialization occurs when there is a decline in the importance of secondary, manufacturing sector of industry in a country.
* Note:
- Sources of some primary products, such as timber, oil and gas, become depleted. This has been true for Somalia with the cutting down of most of its forests.
- Most developed economies are losing competitiveness in manufacturing to the newly industrialized countries such as Brazil, India and China.
- As a country's total wealth increases and living standards rise, consumers tend to spend a higher proportion of their incomes on services such as travel and restaurants than on manufactured products produced from primary products.
* Note:
- Sources of some primary products, such as timber, oil and gas, become depleted. This has been true for Somalia with the cutting down of most of its forests.
- Most developed economies are losing competitiveness in manufacturing to the newly industrialized countries such as Brazil, India and China.
- As a country's total wealth increases and living standards rise, consumers tend to spend a higher proportion of their incomes on services such as travel and restaurants than on manufactured products produced from primary products.
MIXED ECONOMY
A mixed economy has both a private sector and a public sector.
=> Private sector - businesses not owned by the government. These businesses will make their own decisions about what to produce, how it should be produced and what price should be charged for it.
Public sector - government - or state - owned and controlled businesses and organizations. The government, or other public authority, makes decisions about what to produce and how much to charge consumers.
=> Private sector - businesses not owned by the government. These businesses will make their own decisions about what to produce, how it should be produced and what price should be charged for it.
Public sector - government - or state - owned and controlled businesses and organizations. The government, or other public authority, makes decisions about what to produce and how much to charge consumers.
In many countries the government controls the following important industries or activities:
+ health
+ education
+ defense
+ public transport
+ water supply
+ electricity supply
+ health
+ education
+ defense
+ public transport
+ water supply
+ electricity supply
MIXED ECONOMIES - RECENT CHANGES
Capital is the money invested into a business by the owners.
They have done this by selling some public sector businesses - owned controlled by government - to private sector businesses.
They have done this by selling some public sector businesses - owned controlled by government - to private sector businesses.
TEST CLASSIFICATION OF BUSINESSES
SOME QUESTIONS OF CLASSIFICATION OF BUSINESSES
ANSWER:
1/ Primary sector: it is connected with extraction and production of natural resources
can be classified as the extractive industry
Secondary sector: it is concerned with the processing of materials which have already been extracted at primary sector
is comprised of the manufacturing industries
Tertiary sector: it is concerned with providing support services to primary and secondary sector
is the service industry
2/ The most important in the most developed economies is secondary sector. Because whether the material has good but not good production stage, the products when launched will not be quality
3/ The most important in the least developed economies is primary sector. Because
4/
5/ Bus operator: tertiary sector (T)
Bus manufacturer: secondary sector (S)
Forestry business: primary sector (P)
Oil - drilling business: primary sector (P)
Food canning business: primary sector (P)
Bank: tertiary sector (T)
6/ Primary sector: forestry, fishing
Secondary sector: bakery, shoe manufacturer
Tertiary sector: restaurant, hospital
7/ Mixed economy has both a private sector and a public sector.
8/ Private sector - businesses not owned by the government. These businesses will make their own decisions about what to produce, how it should be produced and what price should be charged for it.
9/Public sector - government - or state - owned and controlled businesses and organizations. The government, or other public authority, makes decisions about what to produce and how much to charge consumers
10/
1/ Primary sector: it is connected with extraction and production of natural resources
can be classified as the extractive industry
Secondary sector: it is concerned with the processing of materials which have already been extracted at primary sector
is comprised of the manufacturing industries
Tertiary sector: it is concerned with providing support services to primary and secondary sector
is the service industry
2/ The most important in the most developed economies is secondary sector. Because whether the material has good but not good production stage, the products when launched will not be quality
3/ The most important in the least developed economies is primary sector. Because
4/
5/ Bus operator: tertiary sector (T)
Bus manufacturer: secondary sector (S)
Forestry business: primary sector (P)
Oil - drilling business: primary sector (P)
Food canning business: primary sector (P)
Bank: tertiary sector (T)
6/ Primary sector: forestry, fishing
Secondary sector: bakery, shoe manufacturer
Tertiary sector: restaurant, hospital
7/ Mixed economy has both a private sector and a public sector.
8/ Private sector - businesses not owned by the government. These businesses will make their own decisions about what to produce, how it should be produced and what price should be charged for it.
9/Public sector - government - or state - owned and controlled businesses and organizations. The government, or other public authority, makes decisions about what to produce and how much to charge consumers
10/