Page 9 - Bisiness Studies

Consumption of businesses are to provide individuals
This is the act of using goods and services with goods and services that satisfy
to satisfy human needs and wants. In their needs and wants, make goods and
everyday life, individuals consume services that are not produced within a
different kinds of goods and services given area available, create employment
to satisfy their needs and wants. For for people to reduce unemployment,
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instance, people consume food to satisfy and promote innovative activities that
hunger, and buy cars for transportation. improve delivery of goods and services.
Moreover, individuals consume different All these are done through combining the
services provided by doctors, teachers, various business processes to make the
the military, taxi drivers, entertainers and items that meet peoples’ demand.
tourist guides.

These business processes (production, Exercise 1.1
distribution, exchange and consumption)
ensure that the product reaches the 1. Kamwendo owns a small shop
fi nal consumers. However, in order to
understand them better, consider an where he sells handmade shoes and
example of a school uniform that a student jewellery. He advertises his products
wears: at the local market and sometimes
(a) The uniform was manufactured by online through social media. Does
a textile factory or business. This Kamwendo’s small shop qualify as
process is called the production phase. a business? Explain reasons for your
(b) It was then transported from the answer.
factory or business to the market for 2. Your aunt applied for a loan from a
consumers. This process is called the microfi nance institution with the aim
distribution phase. of opening a restaurant. However,
(c) Then someone visited the market and the loan offi cer asked her to explain
bought the uniform by offering the the purpose of that business. Help
seller some money. This process is your aunt to explain her business
referred to as the exchange phase. purpose.

(d) The student wears the uniform at 3. Mwanakombo transported woods
school. This process is called the from Njombe last month. She used
consumption phase. them to make different furniture.
Briefly, explain the business
Purpose of a business processes that Mwanakombo needs

The main goal of any business is to to undertake for the furniture to reach
generate profi t. However, other purposes the fi nal consumers.

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