Influences On Business

Question 1

Not for profit organisations

Answer 1

Businesses specifically set up to benefit other people.

Question 2

Enterprise

Answer 2

A business or the quality of utilizing business opportunities

Question 3

Entrepreneur

Answer 3

Someome who takes on the risks of enterprise activity

Question 4

Four factors of production

Answer 4

Land (teritory, materials, renewable resources)
Labour (work done by people who contribute to the production process)
Capital (equiptment, factories and schools that help produce goods or services)
Enterprise (refers to the entrepreneurs that take the risks.

Question 5

Opportunity cost

Answer 5

The benefit that is given up in order to do something else.

Question 6

Sole trader

Answer 6

Businesses with just one owner

Question 7

Unlimited liability

Answer 7

You are personally responsible for all the debts of a company.

Question 8

Limited company

Answer 8

A business that has limited liability. The owners only risk losing money invested into the business

Question 9

Social enterprise

Answer 9

People who make money by selling products, but their aims are to use those profits to benefit society

Question 10

Advantages ofa sole trader

Answer 10

. Easy to set up
. Independence
. Limited paperwork to set up
. All decisions go through you

Question 11

Disadvantages of a sole trader

Answer 11

. Could be hard to raise capital
. Limited ideas
. Unlimited liability
. Loans are less likely to be provided for sole traders
. May work long hours

Question 12

Advantages of Partnerships

Answer 12

. Multiple different people in specialized fields, more ideas
. Easier to raise finances
. More likely to recieve loans than sole traders

Question 13

Disadvantages of partnerships

Answer 13

. Lots of paperwork including the deed of partnerhsip
. May have conflicted ideas
. Profits are shared
. You become liable to other peoples mistakes

Question 14

Private limited company advantages (ltd)

Answer 14

. You cant lose more than you invest
. Easy to get loans
. Owner keeps control over shareholders

Question 15

Private limited company disadvantages

Answer 15

. More difficult and expensive to set up due to paperwork
. Must publish accounts each year (does not have to be public)

Question 16

Public limited company (PLC) advantages

Answer 16

. Much more capital can be raised than any other business
. Limited liability
. Helps company expand and diversify

Question 17

Public limited company (PLC) disadvantages

Answer 17

. Hard to please all shareholders on how the business is run
. Easy for someone to buy enough shares to takeover business
. Could be hard finding shareholders when a company is new
. Acounts must be published publically
. More profits are shared

Question 18

Consumer law

Answer 18

refers to any piece of government legislation designed to protect consumers from poor-quality products and poor business practices.

Question 19

What are the product laws in the uk

Answer 19

The goods must be:

. Described accurately
. Fit for purpose
. Satisfactory quality (not be damaged or faulty when sold as new)

Question 20

What are the Consumer laws regarding services

Answer 20

. The service provider must use reasonable care and skill in delivering the service
. Any written or verbal information provided by the supplier is binding
. The service must be provided in a reasonable time, unless agreed otherwise
. The service must be provided for a reasonable price, if the price is not agreed beforehand

Question 21

What is employment law

Answer 21

The term ‘employment law’ refers to any piece of government legislation designed to protect employees from exploitation

Question 22

What does the equality act state

Answer 22

Employers are required to treat people fairly and not to discriminate in any way.

Question 23

What is the employment rights act

Answer 23

The act that states what working for a company will entail (e.g, the job title and place of work,
the date the employment started, the hours of work and the salary or wage)

Question 24

What age group is the national minimum wage directed to

Answer 24

16-22

Question 25

What age group is the national living wage dorected to

Answer 25

People aged 23 or over

Question 26

What does the equality act state

Answer 26

That people doing the same job cannot be paid different than others

Question 27

How many weeks minimum is an employee allowed to take off per year

Answer 27

5.6 weeks

Question 28

Advantages of following legal obligations

Answer 28

. Employees are more confident of their safety working at a company- improved motivation
. The business will gain a better reputation
. Avoid fines or restrictions

Question 29

Disadvantages of following legal obligations

Answer 29

. employers could find themselves in court which means they may have to pay expensive legal fees
. employers may have to pay fines and compensation if they break employment laws
. Suppliers and stakeholders would want to limit involvement with the business
. Bad reputation

Question 30

Which ways can the economy affect businesses

Answer 30

. Unemployment
. Inflation
. Changes of consumers imcome
. Changes in interest
. Changes in exchange rate
. Government taxation

Question 31

What does the interest rate represent

Answer 31

The interest rate represents the cost of borrowing money or the amount a saver receives in interest.

Question 32

How will am increase in interest affect savers and borrowers

Answer 32

. Savers would be more likely to save since they get a higher reward for saving
. Borrowers will be less likely to borrow since they have to pay back more

Question 33

How will a decrease in interest affect savers and borrowers

Answer 33

. People will be less likely to save because they will get less money back
. People will be more likely to borrow since they will have to pay back less added on interest

Question 34

Income tax

Answer 34

is charged on income , such as wages that have been earned.

Question 35

Corporation tax

Answer 35

is a charge on a company’s profits

Question 36

Value-added tax (VAT)

Answer 36

a charge on sales of goods and services based on the value of the item sold.

Question 37

SPICED

Answer 37

Strong pound - imports cheaper, exports dearer

Question 38

WPIDEC

Answer 38

Weak pound - imports dearer, exports cheaper