CHAPTER TWO – SMALL BUSINESS DECISION MAKING REVISION

Question 1

Demand

Answer 1

In Business terms, demand is the quantity of a product that consumers are prepared to purchase.

Question 2

Entrepreneurship

Answer 2

Entrepreneurship is the ablity and willingness to start, operate and assume the risk of a business venture in the hope of making a profit.

Question 3

Partnership

Answer 3

A partnership is an unincorporated legal business structure with a minimum of two and a maximum of 20 owners.

Question 4

Proprietary company

Answer 4

A proprietary (private) company is an incorporated business with a minimum of two, and a maximum of 50 private shareholders.

Question 5

Franchise

Answer 5

A franchise means buying the rights from another business to distribute its product under its name.

Question 6

Solicitor

Answer 6

Solicitors provide infromation concerning business formation and structures, registation, contract,lease, partnership agreements, patents and legislations.

Question 7

Victorian Employers Chamber of Commerce and Industry (VECCI)

Answer 7

VECCI is the state’s main employer group and Australia’s largest multi-industry employer organisation.

Question 8

Local government

Answer 8

aLocal councils offer advice on landing zoning, assist with subsidised land and consider development application.

Question 9

Market research

Answer 9

Market research is a process of systematically collecting, recording and analysing information concerning a specific market.

Question 10

Business Entity

Answer 10

A business entity is any organistion engaged in the production of goods and services.

Question 11

Silent partner

Answer 11

A silent or sleeping partner contributes financially to the business but takes no part in the running of the partnership.

Question 12

Public Company

Answer 12

A public company is a company that has issued securities through an initial public offering (IPO) and is traded on at least one stock exchange or in the over the counter market.

Question 13

Franchisor

Answer 13

A franchisor is an individual or organisation that grants a franchise.

Question 14

Accountant

Answer 14

Complementary businesses provide valuable advice on all financial managments issues and taxation oblugations.

Question 15

Small Business Association of Australia and New Zealand

Answer 15

This lobby group provides a forum for exchanging news and views relating to small business matters.

Question 16

Informal networks

Answer 16

Business people can use their network of friends and colleagues, as well as other business owners to gain information and advice.

Question 17

Market conditions

Answer 17

Market conditions are the features of a market into which a new product or service is to be introduced, include factors such as the number of potential customers, levels of competition and potential for growth.

Question 18

Incorporated business

Answer 18

A business that is Incorporated has a separate legal entity from the owner(s).

Question 19

Incorporation

Answer 19

Incorporation is the process that businesses go through to become registered company and a separate legal entity.

Question 20

Cooperative

Answer 20

A cooperative is a democratic organisation owned nd controlled by the people it serves, who join together for a common benefit.

Question 21

Franchisee

Answer 21

A franchisee is an individual or organisation that purchases a franchise.

Question 22

Bank Manager

Answer 22

Bank Managers are another valuable contact who can provide information and advice on financial services, sources of finance, and basic business management.

Question 23

Trade associations

Answer 23

Trade associations offer specific indusrtu=y information and assistance.

Question 24

Business ethics

Answer 24

Business ethics is the application of moral standards to business behaviour.

Question 25

Innovation

Answer 25

Innovation is either creating a new product, service or process, or significantly improving an existing one.

Question 26

Sole trader

Answer 26

A sole trader (proprietor) business is a business owned and operated by one person.

Question 27

Shareholders

Answer 27

Shareholders (or members) are the owners of the company.

Question 28

Trust

Answer 28

A trust is a business structure where a trustee (usually a company) holds property or carries out a business on behalf of the members of the trust, known as beneficiaries.

Question 29

Zoning

Answer 29

Zoning is a means by which local councils allocate land for different uses, such as residential, commercial, recreation and industrial

Question 30

Business Enterprise Centres (BEC) Australia

Answer 30

BEC Australia is a not-fot-profit network of business enterprise centers which provide support to small business owners.

Question 31

Federal government

Answer 31

The federal government operates a website, ww.business.gov.au, as a service to businesses of all sizes, offering access to all government department advice on everything from fair trading to taxation.

Question 32

Socially responsible management

Answer 32

Socially responsible management is managing an organisation in such a way that the broader social welfare of the community is taken into consideration when making the business decisions.

Question 33

Research and Development

Answer 33

Research and Development (R&D) is a set of activities undertaken to: import existing products, create new products and improve production.

Question 34

Unlimited liability

Answer 34

Unlimited liability means the business owner is personally responsible for all the debts of his or her business.

Question 35

Limited liability

Answer 35

Limited liability means that the shareholders in the company cannot be held personally responsible for the debts of that business.

Question 36

Goodwill

Answer 36

Goodwill is the monetary value attached to the reputation of a particular business.

Question 37

Complementary businesses

Answer 37

Complementary businesses offer products or services that are related to a different business and that may be of use tot eh customers of the business.

Question 38

Chambers of Commerce

Answer 38

These are local associations of business people, usually centered around a suburb or region.

Question 39

State government

Answer 39

In Victoria, the Department of Business and Innovation’s Business Victoria website (wwwbussiness.vic.gov.au) provides entry and links to information and support on all aspects of starting and managing a business.

Question 40

Stakeholders

Answer 40

Stakeholders are individuals or groups with an interest in the success of the business