Chapter 1.2

Question 1

Unincorporated

Answer 1

owner is the same legal entity as the business - sole trader bears full responsibility for all losses/liability if business collapses

Question 2

Partnership

Answer 2

profit-seeking business owned by two or more persons (for ordinary partnerships, the maximum number of owners is 20)

Question 3

Silent partners

Answer 3

do not actively take part in the running of the partnership but have a financial stake in it - eligible for a portion of the profits

Question 4

Deed of partnership

Answer 4

legal contract signed by the owners of a partnership - specify the name and responsibilities of each partner and their share of any profits or losses

Question 5

Companies

Answer 5

a business that is owned by shareholders - issued a certificate of incorporation, giving it a separate legal identity from its owners(shareholders)

Question 6

Board of director

Answer 6

person elected by shareholders to run the company on their behalf

Question 7

Private limited company

Answer 7

a company that cannot raise share capital from the general public - shares sold to private family members and friends (many private limited company are run as family businesses) (ex. Chanel, IKEA)

Question 8

Public limited company

Answer 8

a company that is able to advertise and sell its shares to the general public via stock exchange (ex. Samsung, Nike, Microsoft)

Question 9

Initial public offering (IPO)

Answer 9

when a business sells all or part of its business to shareholders on a stock exchange for the first time

Question 10

Limited Liability

Answer 10

restriction on the amount of money that owners can lose if their business goes bankrupt

Question 11

Cooperatives

Answer 11

for-profit social enterprises set up, owned and run by their members, who might be employees and/or customers - three main types: consumer cooperatives, worker cooperatives, producer cooperatives

Question 12

Microfinance

Answer 12

type of financial service aimed at entrepreneurs of small businesses, especially females and those on low incomes (ex. help women in Vietnam who make and sell bamboo products)

Question 13

Public-private partnerships

Answer 13

when the government works together with the private sector to jointly provide certain goods or services (ex. London Olympic Stadium, HK Disneyland, WHO)

Question 14

NGO

Answer 14

non-profit social enterprise that operates in the private sector that operate for the benefit of others rather than primarily aiming to make a profit (ex. SPCA, Unicef) - Operational NGO and advocacy NGO

Question 15

Charities

Answer 15

non profit social enterprise that provide voluntary support doe good causes (ex. Make a Wish, WWF)

Question 16

Private sector

Answer 16

part of the economy run by private individuals rather than by the government (ex. sole traders, partnership)

Question 17

Public sector

Answer 17

part of the economy controlled by the government (ex. national defence, education service)

Question 18

Social enterprises

Answer 18

revenue generating business where all profits or surpluses are reinvested for that social purpose rather than being distributed to shareholders and owners

Question 19

Sole trader

Answer 19

an individual who runs and owns a personal business (the owner is held responsible for its success or failure/this is the most common type of business ownership) (ex.self-employee decorators,plumbers, photographer)