Econ Vocab 8 Flashcards
Business organization
an enterprise that produces goods or provides
Sole proprietorship
a business owned and managed by a single person
Limited life
a situation in which a business ceases to exist if the owner dies, retires, or leaves the business for some other reason
unlimited liability
a situation in which a business owner is responsible for all the losses, debts, and other claims against the business
Partnership
a business co-owned by two or more people, or “partners,” who agree on how responsibilities, profits, and losses will be divided
General partnership
a partnership in which partners share responsibility for managing the business and each one is liable for all business debts and losses
limited partnership
a partnership in which at least one partner is not involved in the day-to-day running of business and is liable only for the funds he or she has invested
limited liability partnership(LLP)
a partner in which all partners are limited partners are limited partners and not responsible for the debts and other liabilities of other partners.
Corporation
a business owned by individuals, called shareholders or stockholders.
Stock
shares of ownership in the corporation
Dividend
part of the profit that the company pays out to stockholders
Public company
A corporation that issues stock that can be freely bought and sold
Private company
One that retains control over who can buy or sell the stock
limited liability
means that the business owner’s liability for business debts and losses is limited
Unlimited life
they continue to exist even after a change in ownership
Horizontal merger
describes the joining of companies that offer the same or similar products or services
vertical merger
describes the combining of companies involved in different steps of production or marketing of a product or service
Conglomerate
results from a merger of companies that produce unrelated goods or services.
Multinational corporation
a large corporation with branches in several countries
Franchise
a business made up of semi-independent businesses that all offer the same products or services
Franchisee
the individual businesses. Fast food restaurants are a good example
Cooperative
a type of business operated for the shared benefit of the owners
Nonprofit organization
an institution that acts like a business organization, but its purpose is usually to benefit society, not to make a profit
