Grade 7 Business Studies Notes
1. Introduction to Business
Business is an activity where goods and services are produced and sold to make a profit. People
start businesses to earn money, fulfill customer needs, and contribute to the economy.
Types of Businesses:
- **Goods-based businesses**: These sell physical products, such as a bakery selling bread or a
clothing store selling clothes.
- **Service-based businesses**: These provide services instead of physical products, like a hair
salon or a transportation service.
- **Manufacturing businesses**: These make products from raw materials, like a car factory or a
furniture-making company.
- **Retail businesses**: These sell goods directly to consumers, like supermarkets and online stores.
2. Needs and Wants
Understanding needs and wants is essential in business because companies must decide what to
sell.
- **Needs**: Basic things required for survival, such as food, water, shelter, and clothing.
- **Wants**: Non-essential items that improve our lives, such as smartphones, video games, and
luxury cars.
Successful businesses focus on providing both needs and wants to attract more customers.
3. Goods and Services
Businesses provide either goods or services to consumers.
- **Goods**: Tangible items that can be seen and touched, like books, shoes, and cars.
- **Services**: Activities or benefits provided by businesses that cannot be physically touched, such
as education, transportation, and healthcare.
Some businesses offer both goods and services, such as a restaurant that sells food (goods) and
provides dining services (services).
4. Producers and Consumers
- **Producer**: A person or business that makes goods or provides services. Examples include
farmers who grow crops, car manufacturers, and software developers.
- **Consumer**: A person who buys and uses goods and services. Consumers create demand for
products, and businesses aim to satisfy their needs.
5. Supply and Demand
Supply and demand affect prices in the market.
- **Supply**: The amount of a product that is available for sale. When supply is high and demand is
low, prices decrease.
- **Demand**: The amount of a product that consumers are willing to buy. When demand is high and
supply is low, prices increase.
Businesses must balance supply and demand to make a profit while keeping customers satisfied.
6. Types of Business Ownership
Businesses can be owned in different ways:
- **Sole Proprietorship**: A business owned by one person. Simple to start but has unlimited liability.
- **Partnership**: A business owned by two or more people. Profits are shared, and partners share
responsibilities.
- **Corporation**: A large business that is legally separate from its owners. Owners (shareholders)
have limited liability.
7. Entrepreneurship
Entrepreneurs are people who start and run businesses. They take risks to create new products or
services.
Characteristics of a successful entrepreneur:
- Creative and innovative
- Hardworking and determined
- Good at managing money
- Able to take risks and solve problems
8. Business Ethics and Social Responsibility
Businesses must operate in a fair and ethical way. Ethical businesses:
- Treat employees and customers with respect
- Follow laws and regulations
- Avoid harming the environment
- Give back to the community through social responsibility programs
