1.2 Business Ownership

Question 1

Sole trader

Answer 1

Someone who sets up a business on his/her own

Question 2

Profit

Answer 2

Measures the difference between the value of a business’ revenue(sales) and its total costs

Question 3

Unlimited liability

Answer 3

Means that the personal possesions of the owners of a business are at risk if there are any problems. There is no limit to the amount of money the owners may have to pay out

Question 4

Partnership

Answer 4

Occurs when two or more people set up a business Enterprise to pursue profit

Question 5

Deed of partnership

Answer 5

Agreement between partners that sets out the rules of partnership such as how profits will be divided and how the partnership will be valued is someone wants to leave

Question 6

Limited liablity

Answer 6

the condition by which shareholders are legally responsible for the debts of a company only to the extent of the nominal value of their shares.

Question 7

Stakeholder

Answer 7

A stakeholder are individuals and organizations that are affected by and affect the activities of a busniess

Question 8

Stock exchange

Answer 8

A market for buying and selling shares of public plimited companies. Large number of shares are being bought and sold at all times.

Question 9

Flotation

Answer 9

when private limited company becomes public limited company and has its shares listed on the stock exchange.