different business forms Flashcards
what are the advantages of a sole trader
the owner keeps all of the profits
the owner has complete control
quicker easier and cheaper to set up than a limited company
disadvantages of being a sole trader
the owner has unlimited liabaility
the owner is the only source of capital
massive workload
advantages of being a private limited company
additional capital can be raised by issuing shares
the owners have limited liability
what are the disadvantages of being a private limited company
profits have to be shared with all the shareholders
the original owners can lose control if they own less than 50% of shares
slower and more expensive to set up and run than a sole trader
advantages of a public limited company
large amounts of capital raised by issuing shares through the stock market
the extra capital can be used to expand the business
expansion leads to higher levels of profits
disadvantages of being a public limited company
profits have to be shared with large numbers of new shareholders
original owners probably lose control as they own less than 50% of the shares
higher annual costs and more paperwork for auditing and submitting the accounts
what are the three types of leadership
authoritarian
democratic
laissez-faire
what does an authoritarian style of leadership
means that decision making powers are kept at the top of the organisation
there is little use of consultation or delegation
favours theory x
what does democratic leadership mean
means that the decision making powers are not kept at the top of an organisation
there is considerable use of consultation and delegation
what does laissez faire organisation
means that the leader has minimal input in the decision making process and leaves the running of the organisation to the employees
what’s the blake mouton grid
it plots the leaders concern for production against the leaders concern for the people working for an organisation
what is 1,1 on the blake mouton grid
impoverished - no concern for production and no concern for the employees. the leader has no interest in the organisation or the people working for it
what is 1,9 in the blake mouton grid
no concern for production but a high level of concern for the employees the leader is a really nice person but employees take advantage of this
what is 5,5 on the blake mouton grid
some concern for production and some concern for the employees. the leader tries to get the best of both worlds but doesn’t fully achieve either
what is 9,1 on the blake mouton grid
produce or perish- high level of concern for production but no concern for the employees. the leader has a fanatical drive to succeed and has an authoritarian style of leadership
