1.2 Types of Business Organisations

Question 1

Sole Trader Advantage

Answer 1

Full control
Easy to setup
You get to be your own boss

Question 2

Sole Trader Disadvantage

Answer 2

Unlimited liability
Unincorporated
Long hours
Lack of finance

Question 3

Partnership Def

Answer 3

Equal Pay

Deed of partners

Question 4

Partnership Examples

Answer 4

Paul Allen and Bill Gates,

Steve Jobs and Steve Wozniak

Question 5

Sole Trader Example

Answer 5

Wedding Planner

Question 6

Partnership Advantages

Answer 6

Share decision making process (new ideas, share the work),

More capital

Question 7

Partnership Disadvantages

Answer 7

Unlimited liability,
Unincorporated,
Lack of agreement

Question 8

Types of partnerships

Answer 8

General Partnership
Limited Partnership
Joint Ventures (specific period of time)

Question 9

Deed of Partners determine how

Answer 9

Decisions will be made
Profits will be distributed,
Disputes will be solved

Question 10

Limited Companies Adv

Answer 10

incorporated,
limited liability,
easy to raise finance,
stable form of structure

Question 11

Limited Companies Disadv

Answer 11

greater admin costs,

public disclosure of company information,

Question 12

Private LC Examples

Answer 12

Amazon,
Toyota,
Samsung,
IKEA

Question 13

Public LC Examples

Answer 13

Sainsbury,
Marks and Spencer,
EasyJet

Question 14

Cooperatives Adv

Answer 14

No conflict between owners and workers

Question 15

Cooperatives Disadv

Answer 15

Limited sources of finance (retained profits, owners capital)
a group of people acting together to meet the common needs and aspirations of its members, sharing ownership and making decisions democratically

Question 16

Cooperatives Def

Answer 16

There are 2 types (for profit): Producers and Retailers.

They are run by a board of directors

Question 17

Producers Def

Answer 17

Producers: owners are the workers (ownership and control)

Question 18

Retailers

Answer 18

Owners are the customers (eg. Banks)

Question 19

Public Corporations

Answer 19

Owned and funded by the government

Question 20

Public Private Partnership (PPP)

Answer 20

Involvement of the private sector in the form of management expertise and/or financial investment in public sector projects in aim of benefiting the public.

Question 21

How to choose ownership structure

Answer 21

The industrial sector
Size
Revenues
Number of workers
Needs of finance (most important!)