Dotpoint 1.4 Flashcards
What are the five types of businesses?
Sole trader, partnership, private limited company (Ltd), public listed company, social enterprise.
What is a sole trader?
A business owned and operated by one person, with unlimited liability.
What is unlimited liability?
The owner is personally responsible for all business debts.
What is a partnership?
A business owned by 2-20 people, with shared responsibility and unlimited liability.
What is a private limited company (Ltd)?
A business with 1-50 shareholders, limited liability, and shares not publicly traded
What is a public listed company?
A company with unlimited shareholders, listed on the stock exchange, and limited liability.
What is a social enterprise?
A business that aims to fulfill a social or environmental mission while generating revenue.
What is a government business enterprise (GBE)?
A government-owned business that provides goods/services while aiming to be profitable.
What is limited liability?
Shareholders are only responsible for the value of their shares, not company debts.
What is an advantage of a sole trader?
Full control and all profits go to the owner.
What is a disadvantage of a sole trader?
Unlimited liability and full responsibility for losses.
What is an advantage of a partnership?
Shared responsibility and skills.
What is a disadvantage of a partnership?
Unlimited liability and potential conflicts.
What is an advantage of a private limited company?
Limited liability and ability to raise capital through shares.
What is a disadvantage of a private limited company?
More regulation and higher setup costs.
What is an advantage of a public listed company?
Can raise large amounts of capital by selling shares.
What is a disadvantage of a public listed company?
High regulatory requirements and loss of control.
What is an advantage of a social enterprise?
Contributes to social causes and can gain public support.
What is a disadvantage of a social enterprise?
Harder to generate profit and secure funding.
What is an advantage of a GBE?
Provides essential services to the public.
What is a disadvantage of a GBE?
Less efficient due to government control and bureaucracy.
What is an objective of a business?
To make a profit, increase market share, or fulfill a social mission.
What is a mission statement?
A statement that defines the business’s purpose and objectives.
What is a stakeholder?
Any person or group with an interest in a business.
