Business Ownership

Question 1

Examples of private sector

Answer 1

individuals/ group of individuals control/ own the business
✰ sole trader
✰ partnership

Question 2

Who owns a private sector business

Answer 2

individuals/ group of individuals control/ own the business

Question 3

Examples of public sector

Answer 3

✰ NHS
✰ leisure centres
✰ education

Question 4

Who owns a public sector business

Answer 4

Government owned, controlled + funded

Question 5

Third/ voluntary sector

Answer 5

✰ charities
✰ social enterprise
✰ not for profit organisations

Question 6

What is a sole trader

Answer 6

A sole trader is privately owned and the owner is self employed.

✰ unlimited liability
✰ personal assets aren’t protected
✰ able to control working hours
✰ little capital at risk

Question 7

What is a partnership

Answer 7

A privately owned business owned by 2 or more people.

✰ requires more skill
✰ don’t have to publish accounts
✰ shared workload
✰ put in capital and get profit

Question 8

What is a private limited company (Ltd)

Answer 8

A company in which a number of shareholders contribute funds to the company in return for shares.

✰ shares can’t be sold on the stock exchange
✰ it’s own legal identity
✰ limited liability
✰ owned by shareholder

Question 9

What is a public limited company (plc)

Answer 9

A plc is suited to large multinational corporations E.g. Amazon

✰ able to raise more capital than a private limited company
✰ can issue shares to potential owners
✰ can trade on the stock market
✰ limited liability

Question 10

What is a franchise

Answer 10

A franchise is a business that gives the right to another person or business to sell goods or services using its name.

✰ less risky than starting a business from scratch
✰ franchisor can provide franchisee with training
X franchisee has to pay a lot of money to start the franchise
X franchisor might have strict rules