objectives - social costs n benefits

5 (a) Profit is the surplus of revenue over allocated costs in a given time period. For many businesses in the private sector it represents a major objective and is often the reason for the existence of such a business. J.T. is a private sector business and thus profit would be important because – represents the return on the investment of its owners/is a source of funds to help finance long term growth and is ultimately needed to ensure the long term survival of the business. Knowledge of importance [1-3] (b) Added value is the difference between the cost of bought in resources and the price at which the “finished product” sells. In this context it is the difference between the costs of rearing animals and their market price. Knowledge of concept [1-2] Understanding of concept in context [1] (c) Depreciation of a currency implies a loss of value of a currency measured in terms of other currencies. Thus a fall in a currency on world markets implies that exports of that country will become cheaper to buyers in export markets. This should allow increased sales to occur and profits to rise. Such a change will be broadly beneficial. The gains might be partially offset if bought in resources are sourced abroad. Knowledge of depreciation [1] Application and analysis of depreciation [1-3] (d) Social benefits refer to the gains to society as a whole as a result of business activity. In this context J.T. might be expected to create direct and indirect employment opportunities/maintain the local environment/rural beauty. Identification of benefits showing knowledge [1-2] Application of benefits in context of case and development of benefits showing understanding [1-2] (e) Changes might refer to structural adjustments or perhaps to the development of a few major industries or companies such as multinationals. Can also include government’s measures of significance. Reference must be made to jobs created and also to the impact that the changes have had on output/availability of goods/exports and hence on national wealth. For the change identified to be acceptable it must refer to a macro change not a small scale micro one. Thus opening of a large multinational is acceptable but NOT the opening of say a new shop in a town. Identification of changes [1-2] Analysis of changes in terms of employment [1-2] Analysis of changes in terms of impact on national wealth [1-2] This is not about wealth redistribution e.g. tax changes but about wealth creation.