2.

Classification of Business
End of Chapter Activity and Questions

International Business in Focus - Tourism in Mauritius

Notes:

Primary sector small due to lack of resources, more GDP from tourism in tertiary sector.

- Tourism, finance – make money for businesses

- Tax revenue – government
- Employment/ work opportunities – people have jobs (better salaries, better living
conditions)
Disadvantages of increase in tourism
- Pollution (airlines)
- Exploitation of culture (changing culture norms)
- Rapid inflation (prices increase quickly – local people can’t afford basic needs)

Exam Style Questions – Short Answer and Data Response

1a. Primary sector is a business that uses natural resources to produce

raw materials used by other businesses
1b. transport and insurance
1c. AEC need to make the car part by steel and steel requires coal and iron. AEC also need
rubber band and rubber band is made up of oil.
1d. Natural resource are running out so the primary sector production will fall and become
not important anymore. The value of tertiary sector output is rising because of high incomes
in country X. This mean the consumers will spend more money on tertiary sector product.
1e. No I don’t agree
Because If Country X invests in secondary sectors, such as vehicle manufacturing,
secondary will become more significant, as cars are now a need rather than a luxury.
Consumers will spend more of their earnings on tertiary sector services, such as tourism, if
incomes continue to increase, therefore Country X may lose competitiveness in secondary
products.

2a. Public sector is part of an economy that is controlled by the government

2b. Food manufacturing, electrical
2c. The need for tertiary is increasing as there is more need of services like financial
institutions, educational institutions
2d. The ministers want to privatize some business in the public sector since it would initiate
better management facilities with the specialized and technical workforce. It would be more
effective to be operating through private organizations and be away from political
hierarchies.
2e. No I don’t agree because I don’t think public sector always produced goods and services
more efficiently than privately owned businesses. Privately owned business usually have
more incomes so it probably produce better product