3.1 what is business Flashcards
define missions and objectives.
mission is the overall aim and objectives help a business achieve the mission.
formula for total revenue
selling price x no sold
define fixed costs
costs that stay the same no matter the output
define variable costs
costs that change with output
formula for total costs
fixed costs + variable costs
sole trader
a person who exclusively owns a business
benefit and negative of sole trader
keep all profits and unlimited liability
private limited company (LTD)
a company that doesn’t publicly sell shares
+ and - of LTD company
decide who owns shares, high set up costs
public limited
openly sells shares on the stock market
public limited + and -
can get capital from shares, may take business away from mission
private sector
businesses that aren’t publicly owned
public sector
businesses that are publicly owned
non profit
businesses that don’t operate for financial gain
unlimited liability
personal belongings can be lost
limited liability
personal belongings can’t be lost
dividends
money returned on a investment
the role of a shareholder
add capital to a business in hopes of a return
why would a shareholder invest in a business
may feel like they can get a return on their investment and believe in the business
factors influencing share price
economy, business performance, demand.
7 external factors that can influence demands and costs
competition, market conditions, demographic factors, incomes, environment issues, pest factors.
