Chapter 2

Classification of businesses
Lesson Objectives

• To understand stages of economic

activity
• To understand importance of
economic sectors
• To understand changes in sector
importance
 KEY WORDS
• Economic activity
• Primary sector
• Secondary sector
• Tertiary sector
• Private sector
• Public sector
Starter activity
In pairs, look around the room and choose any object

Write down as many raw materials used to make product as you

can

Discuss…
Where did those materials come from?

How were those materials transformed into the product chosen?

How did the product end up at school?

1.Free market Economy
2.Planned Economy
3.Mixed Economy
 Importance of Economic Sectors
L.O. Learning why the importance of sectors may change in a country
and what ‘public’ and ‘private’ sector of the economy means
Decentralization:

the transfer of control of an activity

 Importance of Economic Sectors
We usually compare sectors of a country’s economy by looking at %
of people employed in each sector

Or by the value of output of goods and services and the proportion

this is of the total national output (GDP)

Complete the boxes below with examples of each industry…

Developing countries – More people

Developed countries – more
employed in primary and secondary
industries people employed in tertiary sector
-> people tend to live in rural areas so less -> Eg: ...., ..... and ....
demand for services like insurance, etc.
-> Eg: ...., .... and ....
 Changes in sector importance
Countries like the UK, USA, Spain, Germany have de-industrialised since the
1970s

-> decline in manufacturing or secondary industry

-> more people working in tertiary (service) industries like banking, tourism, etc.

Countries like China, Brazil, India have industrialised since the 1980s

-> growth of secondary industry

This has happened because… (read p14 and write three reasons below)

1.
2.
3.
 • Choose three countries of differing economic
development levels (eg: Spain, China, Haiti)

•Find GDP information – total GDP and percentage per

sector using data sheet

•Work out sector size in degrees (360 * %)

Homework
•Draw and colour in on template sheet using a
protractor!

•Stick in your books

•Write an answer to: Why do you think each country is

different? (You may need to research your answers)
 Plenary
• What are the three sectors of the economy?
----Primary sector, secondary sector, tertiary sector
• What do you think the fourth sector is called?
----Quaternary sector
• What do you think the quaternary sector involves?
----R&D, consultancy, information services
• What links the sectors of the economy to businesses?
Businesses can be categorised by the sector in which they operate, eg
agriculture = primary sector