Limited Companies And Multinationals

Question 1

Features of limited companies

Answer 1

+ owners have limited liability
+ the business raises capital by selling shares
+ the shareholders elect directors to run the company

Question 2

What are limited companies?

Answer 2

Businesses that have a separate legal identity from of their owners.

Question 3

Features of private limited companies?(Ltd)

Answer 3

public limited companies tend(PLC) to be larger than Ltd

• shares are only transferred privately
• they are often family businesses owner by family members
• the directors of these firms tend to be shareholders

Question 4

Advantages of private limited companies

Answer 4

• shareholders have limited liabilities
• more capital can be raised
• business continues if the shareholder dies

Question 5

Disadvantages of private limited companies

Answer 5

• financial information has to be made public
• costs of money takes time to set up.
• profits are shared between more members

Question 6

Advantages of public limited companies

Answer 6

• large amounts of charitable can be raised
• shareholders have limited liability
• PLCs exploit economies of scale

Question 7

Disadvantages of public limited companies

Answer 7

• setting up costs can be expensive
• outsiders can take control by buying shares
• more financial information has to be made public
• managers may take control rather than owners

Question 8

What is a multinational company?

Answer 8

Large businesses with significant production or service operations in at least two different countries.

Question 9

Features of Multinational companies

Answer 9

+Huge assets (land, buildings,machinery and money)
+highly qualified and experienced executives and managers
+powerful advertising and marketing capability
+highly up-to-date technology
+highly influential, both economical and political
+very efficient since the exploit large economies of scale
+ownership and control is centred to the host country