Introduction to Business

Question 1

what is a sole trader?

Answer 1

anyone who owns or runs a business by themselves

Question 2

What are the benefits of being a sole trader?

Answer 2

self satisfaction, keeps profits, and not restrictions

Question 3

what is limited liability?

Answer 3

you are personally responsible for all the debts

Question 4

what is a partnership?

Answer 4

two or more people own and run a business together

Question 5

what are 2 benefits of partnerships?

Answer 5

• less stress

- shared expanded experteese

Question 6

what are 2 negatives of partnerships?

Answer 6

• split profits

- unlimited liability

Question 7

what is a deed of partnership?

Answer 7

a document that lays out rules for running the partnership

Question 8

what is a sleeping partnership?

Answer 8

when someone invests in a business but doesn’t take part in running the business

Question 9

What is a company?

Answer 9

a business with its own legal existence

Question 10

What is Ltd?

Answer 10

private limited company,

Question 11

What is plc?

Answer 11

public limited company

Question 12

Give 2 + of ltd.

Answer 12

• limited liability

- shareholders invest

Question 13

Give 2 - of ltd.

Answer 13

• loss of individual control

- complicated to set up

Question 14

Give 2 + of plc.

Answer 14

• raises lots of capital

- generates lots of publicity

Question 15

Give 2 - of plc.

Answer 15

• extremely expensive

- potential takeover

Question 16

Give 2 facts of ltd.

Answer 16

• owners called shareholders

- controlled by board of directors

Question 17

Give 2 facts of plc.

Answer 17

• shareholders are members of the public

- controlled by board of directors

Question 18

What is social enterprise?

Answer 18

a business seen to be giving back, spending profit on society

Question 19

What are multinational corporations?

Answer 19

companies with factories in many countries

Question 20

What are 2 + of multinationals?

Answer 20

• creates jobs in LEDC’s

- pays tax to local governments

Question 21

What are 2 - of multinationals?

Answer 21

• exploitation of workers

- use up local resources (water)

Question 22

define franchising.

Answer 22

paying a royalty fee to trade under another businesses name (MacDonalds)

Question 23

what is a + of franchising for franchisee?

Answer 23

• established name already

Question 24

what is a - of franchising for franchisee?

Answer 24

• lack of total control

Question 25

what is a + of franchising franchiser?

Answer 25

• quick way to expand across many areas

Question 26

What is a - of franchising for franchiser?

Answer 26

• risk of reputation from bad franchisee

Question 27

what are the 3 sectors?

Answer 27

primary, secondary, tertiary

Question 28

give an example of a product from each sector of the market .

Answer 28

p: coal (raw materials)
s: car brakes (things)
t: teaching (services)

Question 29

what is an entrepreneurship?

Answer 29

owning your own business and constantly having excellent ideas