introduction to business Flashcards
what is a business
An organisation that exists to provide goods and services on a commercial basis to customers
what are goods
Goods are physical or tangible products e.g. consumer electronics, cars
what are services
Services are intangible products e.g. insurance,dental services, cleaning
Why do businesses exist
Businesses exist because they are formed by entrepreneurs and are subsequently developed if they manage to get beyond the survival stage
How do businesses play a key role in wider society
They create and sustain employment and develop the skills of people
They contribute to the infrastructure of the country
They pay taxes on profits earned and collect taxes on behalf of the government
Describe the transformation process
In different ways all businesses take resource inputs and transform them into goods and services. This is known as the transformation
What is the role of
Entrepreneurs
They spot business opportunities
They take risks in order to gain possible future returns
What are the four business sectors
Primary, secondary, tertiary, quaternary
What is an unincorporated business
The owner is the business-no legal difference
The owner has unlimited liability for business actions
Most unincorporated businesses operate as sole traders
What is incorporated business
There is a legal difference between
Owners have limited liability the business and the owners
The company has a separate legal identity
What is unlimited liability
Business owners is personally responsible for the debt and liability of the business
