3.1 what is business

Question 1

define missions and objectives.

Answer 1

mission is the overall aim and objectives help a business achieve the mission.

Question 2

formula for total revenue

Answer 2

selling price x no sold

Question 3

define fixed costs

Answer 3

costs that stay the same no matter the output

Question 4

define variable costs

Answer 4

costs that change with output

Question 5

formula for total costs

Answer 5

fixed costs + variable costs

Question 6

sole trader

Answer 6

a person who exclusively owns a business

Question 7

benefit and negative of sole trader

Answer 7

keep all profits and unlimited liability

Question 8

private limited company (LTD)

Answer 8

a company that doesn’t publicly sell shares

Question 9

+ and - of LTD company

Answer 9

decide who owns shares, high set up costs

Question 10

public limited

Answer 10

openly sells shares on the stock market

Question 11

public limited + and -

Answer 11

can get capital from shares, may take business away from mission

Question 12

private sector

Answer 12

businesses that aren’t publicly owned

Question 13

public sector

Answer 13

businesses that are publicly owned

Question 14

non profit

Answer 14

businesses that don’t operate for financial gain

Question 15

unlimited liability

Answer 15

personal belongings can be lost

Question 16

limited liability

Answer 16

personal belongings can’t be lost

Question 17

dividends

Answer 17

money returned on a investment

Question 18

the role of a shareholder

Answer 18

add capital to a business in hopes of a return

Question 19

why would a shareholder invest in a business

Answer 19

may feel like they can get a return on their investment and believe in the business

Question 20

factors influencing share price

Answer 20

economy, business performance, demand.

Question 21

7 external factors that can influence demands and costs

Answer 21

competition, market conditions, demographic factors, incomes, environment issues, pest factors.