1. different forms of business

Question 1

public sector

Answer 1

organisations owned and run by the government e.g NHS, schools

Question 2

private sector

Answer 2

organisations owned and run by private individuals e.g sole traders, charities

Question 3

non for profit objectives

Answer 3

help and benefit the community

Question 4

social enterprise objectives

Answer 4

social or environmental objectives, profit is used for its social activities that benefit society

Question 5

unlimited liability

Answer 5

the business and owner are one legal entity
business debts become personal debts e.g sole trader

Question 6

limited liability

Answer 6

the business and owner are two separate legal entities. not personally responsible for the debts of the business e.g share holders

Question 7

sole trader

Answer 7

run by an individual
- unlimited liability
- full responsibility for financial control

Question 8

advantages of sole trader

Answer 8

• freedom
• keep all profit
• simplicity
• savings on fees

Question 9

disadvantages of sole trader

Answer 9

• responsibility risk
• time (long hours)
• expertise (limited skills)
• finance
• vulnerability
• unlimited liability

Question 10

private limited companies

Answer 10

cannot sell shares to the public
no shares on stock exchange
often small family businesses
no minimum share capital

Question 11

public limited companies

Answer 11

can sell shares to the public and stock exchange
shares are freely transferable

Question 12

ordinary share capital

Answer 12

share sold to raise money

Question 13

dividend

Answer 13

A proportion of profit which are split and paid to shareholders

Question 14

market capitalisation

Answer 14

total value of ordinary shares issued by a company
- number of shares issued x current share price