Introduction to Business Flashcards
what is a sole trader?
anyone who owns or runs a business by themselves
What are the benefits of being a sole trader?
self satisfaction, keeps profits, and not restrictions
what is limited liability?
you are personally responsible for all the debts
what is a partnership?
two or more people own and run a business together
what are 2 benefits of partnerships?
- less stress
- shared expanded experteese
what are 2 negatives of partnerships?
- split profits
- unlimited liability
what is a deed of partnership?
a document that lays out rules for running the partnership
what is a sleeping partnership?
when someone invests in a business but doesn’t take part in running the business
What is a company?
a business with its own legal existence
What is Ltd?
private limited company,
What is plc?
public limited company
Give 2 + of ltd.
- limited liability
- shareholders invest
Give 2 - of ltd.
- loss of individual control
- complicated to set up
Give 2 + of plc.
- raises lots of capital
- generates lots of publicity
Give 2 - of plc.
- extremely expensive
- potential takeover
Give 2 facts of ltd.
- owners called shareholders
- controlled by board of directors
Give 2 facts of plc.
- shareholders are members of the public
- controlled by board of directors
What is social enterprise?
a business seen to be giving back, spending profit on society
What are multinational corporations?
companies with factories in many countries
What are 2 + of multinationals?
- creates jobs in LEDC’s
- pays tax to local governments
What are 2 - of multinationals?
- exploitation of workers
- use up local resources (water)
define franchising.
paying a royalty fee to trade under another businesses name (MacDonalds)
what is a + of franchising for franchisee?
- established name already
what is a - of franchising for franchisee?
- lack of total control
what is a + of franchising franchiser?
- quick way to expand across many areas
What is a - of franchising for franchiser?
- risk of reputation from bad franchisee
what are the 3 sectors?
primary, secondary, tertiary
give an example of a product from each sector of the market .
p: coal (raw materials)
s: car brakes (things)
t: teaching (services)
what is an entrepreneurship?
owning your own business and constantly having excellent ideas
