Q1] Define these terms : BS C2 [ Classification of Business ]

Primary Sector ; This sector extracts and uses the natural resources of Earth to produce raw materials used by other
businesses e:g Farming, Fishing & Forestry.
Secondary Sector ; This sector of industry manufactures goods using the raw materials provided by the primary sector.
e:g Construction, Car manufacturing & Computer assembly.
Tertiary Sector ; This sector provides services to both consumers & other businesses. E:g Banking, Retail, Insurance
De-industrialization ; It occurs when there is a decline in the importance of the secondary (manufacturing) sector in a country.
Mixed Economy ; This economy has both a private sector and a public sector
Planned Economy / Public sector ; Businesses and organizations are mostly owned & controlled by the state/government.
Free Market Economy / Private Sector ; Businesses and organizations are mostly owned and controlled by privately.

Q2] Which sector of industry is more important to an economy - Primary / Secondary or Tertiary ?

-More primary sectors in an economy means country is under developed or is in developing phase
-More Secondary sectors means an economy is developing as their is industrialization.
-More Tertiary sector indicates that a country is Developed and is having growth stage.

All sectors are important but countries should try to move towards tertiary sector and secondary sectors because it shows that
the country has made progress in terms of economic development and more income can be generated in these two sectors as
compared to Primary.
Furthermore, the countries which has a higher proportion of workers in each category or which has much output level in
comparison to eachother would be considered the most important in each case.

Q3] Do you think that in developing economies the relative importance of the secondary sector has increased as compared to
primary sector in recent years?

Ans : In many countries , Secondary sector has become more important than primary sector in developing economies due to
several reasons;
- Industrialization : If country wants to develop, it has to shift from primary to secondary which is done by introducing more
Manufacturers & Factories for production, thus the country encourages industrialization.
- Urbanization : As more people want to live in urban cities , the population in rural areas decrease by time and so no or little
farming, and other primary activities such as Extraction of raw materials is done. This results in more Work &
progress in secondary sector
- Technology & Infrastructure : Developing economies have improved their technological capabilities and infrastructure to
support industrial and manufacturing activities.
Q4] Why wages of workers in primary sector may fall ?
a) Country shifting to Sec/tertiary sector
b) Many people available to work in Primary sector so cheap labour can be bought
c) Seasonal variations. as seasons change no need for farming so people's wages may fall.
d) Government changes policies. Reduces wages for primary sectors.

Q5] A private sector b.s produce g/s more efficiently than a public sector business. Discuss

Private vs Public
a) Profit maximizing a) Services free of cost to consumers
b) More competition b) as government is in control , so no competition
c) More redundancy rate c) less / low redundancy (The rate at which employees leave job)

Reading Answer Only ;

The word efficiency in general means ‘ to generate highest possible output levels in a most minimal use of resources or cost.

The public sectors usually has a low redundancy rate and labor turnover as their objective is not to cut the
costs but rather to provide for goods/services having low or no prices such as free hospitals , education , railways etc. Due to
such aims, employees are always motivated as they don’t have fear of being removed. And therefore they are more efficient in
providing services.
However Private sectors aim towards profit - maximization which makes them more efficient as they have
to deploy resources at low costs and having high quality (cheap but qualitative labor, cheap but more output generating
machines in factories) as they cannot afford higher costs, thus leading to a improved output than that we see in public sectors.
On the other hand, the government is almost a monopoly so no/less competition. However, there is a higher
competition in the private sectors as there are more suppliers in such industries and each is willing to lead the market by
providing best possible goods/services in least possible costs ultimately making them more efficient.

Therefore , due to reasons above explained in favor of private sectors, I agree to disagree with the minister’s statement.