Summary IGCSE Business Studies - Business studies

Chapter 2
Classification of businesses
STAGES OF PRODUCTION

Stage 1

Stage 1 is called the primary stage of production

This is also called the Primary Sector of Industry

PRIMARY SECTOR of industry extracts and uses the natural resources of Earth to produce raw
materials used by other businesses.

Stage 2

Stage 2 is called the secondary stage of production

This is also called the Secondar Sector of Industry

SECONDARY SECTOR of industry manufacturers goods using the raw materials provided by the
primary sector.

Stage 3

Stage 3 is called the tertiary stage of production

This is also called the Tertiary Sector of Industry

TERTIARY SECTOR of industry provides services to consumers and the other sectors of industry.



CHANGES IN SECTOR IMPORTANCE

-DE-INDUSTIALISATION-

DE-INDUSTRIALISATION occurs when there is a decline in importance of the secondary,
manufacturing sector of industry in a country.

MIXED ECONOMY

A MIXED ECONOMY has both a private sector and public sector

PRIVATE SECTOR – Businesses not owned by the government. The main aim of these businesses are
to make profits

PUBLIC SECTOR – Businesses owned and controlled by the government. Some services such as health
and education are free to the consumers.

CAPITAL

CAPITAL – Money invested into a business by the owners