intangible item - insurance, cleaning, dental care
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Characteristics of a business?
diverse, present in many aspects of our lives, supply essential and luxury products, supply an enormous range of goods and services demanded by individual consumers and other businesses
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Essential products
such as electricity, healthcare, and education
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Luxury products
includes jewellery, gourmet meals and designer clothes
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Benefits of a business to a country, its economy and inhabitants:
creates employment, creates wealth, creates new products, enhance's a country's reputation
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Businesses create employment:
allows people to earn incomes and benefit from being able to purchase a range of goods and services
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UK employment (example):
September 2014: 30.79 million people employed - a rise of 694,000 compared to March 2013. It is an attractive location for foreign businesses (HSBC, Zara, Nissan...) - employment created attracts migrants.
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Businesses create wealth:
they have created surpluses invested in a range of assets such as roads, bridges, hospitals...this brings significant benefits to the country, many people and other businesses, as well as increasing the country's wealth.
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UK wealth (example):
businesses have built the M6 toll motorway near Birmingham. UK businesses pay large amounts of taxation to the government. 2013-14: UK businesses paid corporation tax of ~£36million - the government uses this money in a variety of ways.
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Corporation tax
taxes on profits
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Businesses create new products:
enriches the lives of people living in a country (UK) - eg: pharmaceutical businesses research and develop medicines that cure illnesses, extend life expectancy, improve people's quality of life.
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GlaxoSmithKline - GSK (new products example):
created the 'Paxil' drug - highly successful, sales generated = over £7.5 billion for the business
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Businesses enhance's a country's reputation:
successful businesses help to establish and maintain a country's reputation for being innovative and forward looking.
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UK reputation (example):
global reputation for top quality music and TV programmes. 'Wall to Wall' is a small business with an international reputation for producing well known programmes (The Voice) - sell in many countries and help present the UK in a favourable light.
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Other cards in this set
Card 2
Front
Product
Back
more general term which includes goods and services.
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