1. Organizations that manufacture products or construct roads, buildings are called … . 2. Private … firms are owned by individuals who hope to make a profit. 3. Land, …, … and enterprise are factors of production. 4. Entrepreneurs set up private sector … in the hope of making profits. 5. Entrepreneurs try to substitute a cheaper … for a more expensive one. 6. … helps advanced economies to function more efficiently. 7. People require a medium of … to buy what they need. 8. Money also functions as a measure of … . 9. To encourage savings to take place, … is paid on them. 10. People are the labour factor of … .
III. Say whether these statements are true or false, and if they are false say why.
1. Primary organizations manufacture products or construct roads. 2. Commercial services are banking, transport and insurance. 3. Another way of classifying organizations results from the UK’s mixed economy. 4. Private sector firms are owned by individuals who provide a service for the community. 5. Entrepreneurs as business owners and decision-takers bear the risk of making a loss. 6. Entrepreneurs compare the relative prices (or costs) of each factor of production and, where possible, substitute a more expensive factor for a cheaper one. 7. Countries tend to avoid specialization in products or services. 8. As a result of specializing, however, a country cannot produce everything it needs for its population. 9. People also specialize, and become independent. 10. Money serves only as a store of value. 11. Where tasks are repetitive, there is scope to replace machines with people. 12. Higher labour unemployment leads to higher social costs. 13. One of the key decisions an entrepreneur must make is where to locate the business. 14. The availability of suitably skilled labour is influencedby the business location.