Chapter 1.2 - Types Of Organizations

Question 1

Charities

Answer 1

Non-profit social enterprises that provide voluntary support for good causes (from society’s point of view), such as protection of children, animals and the natural environment.

Question 2

Cooperatives

Answer 2

for-profit social enterprises are set up, owned and run by their members, who might be employees and/or customers

Question 3

Company (or corporation)

Answer 3

Refers to a business that is owned by shareholders. It has been issued a certificate of incorporation, giving it a separate legal identity from its owners

Question 4

Deed of Partnership

Answer 4

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

Question 5

Incorporation

Answer 5

Means that there is a legal difference between the owners of a company and the business itself. This ensures that the owners are protected by limited liability.

Question 6

Initial Public Offering (IPO)

Answer 6

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

Question 7

Limited Liability

Answer 7

Is a restriction on the amount of money that owners can lose if their business goes bankrupt, i.e., shareholders cannot lose more than they invested in the company.

Question 8

Microfinance

Answer 8

Is a type of financial service aimed at entrepreneurs of small businesses, especially females and those on low incomes.

Question 9

Non-governmental Organizations (NGO)

Answer 9

Are private sector not-for-profit social enterprises that operate for the benefit of others rather than primarily aiming to make a profit,

Question 10

Partnerships

Answer 10

Are a type of private sector business owned by 2-20 people (known as partners). They share the responsibilities and burdens of running and owning the business

Question 11

Private Limited Company

Answer 11

Business owned by shareholders with limited liability but whose shares cannot be bought by or sold to the general public

Question 12

Private Sector

Answer 12

Part of the economy RUN BY PRIVATE INDIVIDUALS AND BUSINESSES, rather than by the government, e.g. Sole Traders, partnerships, companies and cooperatives.

Question 13

Public Limited Company

Answer 13

incorporated business that allows the general public to buy and sell shares in the company via a stock exchange. All shareholders enjoy limited liability.

Question 14

Public-private partnerships (PPP)

Answer 14

Occur when the government works together with the private sector to jointly provide certain goods or services.

Question 15

Public Sector

Answer 15

Part of the economy controlled by the government. Examples include state health and education services, the emergency services and national defence.

Question 16

Sole Trader

Answer 16

Self-employed person who runs and controls the business and is the sole person held responsible for its success (profits) or failure (unlimited liability).

Question 17

Social Enterprises

Answer 17

Are revenue-generating business with social objectives at the core of their operations. They can be for-profit or nonprofit businesses, but all profits or surpluses are reinvested for that social purpose rather than being distributed to shareholders and owners.

Question 18

State-owned Enterprises

Answer 18

Are organizations wholly owned by the government.

Question 19

Stock Exchange

Answer 19

Is a market place for trading stocks and shares of public limited companies. Examples include the London Stock Exchange (LSE) and the New York Stock Exchange (NYSE)

Question 20

Unlimited Liability

Answer 20

Is a feature of sole traders and ordinary partnerships who are legally liable for all monies owed to their creditors, even if this means that they have to sell their personal possessions to pay for their debts.