2 - Business structure Flashcards
Define private limited company
a business owned by shareholders who are often members of the same family; this company cannot sell shares to the general public
Define initial public offering (IPO)
an offer to the public, to buy shares in a public limited company
Define public limited company
a company whose shares are traded on the stock exchange and can be bought and sold by the general public
Define primary sector business activity
firms engaged in farming, fishing, oil extraction and all other industried that extract natural resources so that they can be used and processed
Define secondary sector business activity
firms that manufacture and process products from natural resources, including computers, brewing, baking, clothes making and construction
Define tertiary sector business activity
firms providing services to consumers and other businesses, such as retailing, transport, insurance, banking, hotels and tourism
Define quaternanry sector business activity
business providing information services, such as computing, web design, ICT, management consultancies and R&D
Define public sector
organisations accountable to and controlled by central or local government
Define private sector
businesses owned and conrolled by individuals or groups of individuals
Define mixed economy
economic resources are owned and controlled by both private and public sectors
Define free-market economy
economic resources are owned largely by the private sector with very little state intervention
Define command economy
economic resources are owned, planned and controlled by the state
Define public corporation
a business enterprise owned and controlled by the state also known as nationalised industry
Define sole trader
a business in which one person provides the permanent finance and in return has full control of the business and it able to kepp all the profits
Define unlimited liability
business owners have full legal responsibility for the debts of the business
Define partnership
a business formed by two or more people to carry on a business together, with shared capital investment and usually shared responsibility
Define limited liability
the only liability a shareholder has if the company fails is the amount invested in the company, not the total wealth of the shareholder
Define share
a certificate confirming part-ownership of a company and entitling the shareholder owner to dividends and certain shareholder rights
Define shareholder
a person or institution owning shares in a limited company
Define memorandum of association
this states the name of the company, the address of the head office trough which it can be contacted, the maximum share capital for which the company seeks authorisation and the declared aims of the business
Define articles of association
this document covers the internal workings and control of the business, the names of directors and the procedures to be followed at meetings
Define cooperative
a jointly owned business operated by memebers for their mutual benefit, to produce or distribute goods or services
Define franchise
the legal right to use the name, logo and trading systems of a existing successful business
Define franchiser
a person or business that sells the right to open stores and sell products or services using the brand name and brand identity
Define franchisee
a person or business that buys the right from the franchiser to operate the franchise
Define joint venture
two or more business agree to work closely together on a perticular project and create a seperate business division to do so
Define social enterprise
a business with mainly social objectives that re-invest most of its profit into benefiting society rather than maximising returns to owners
