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Pob (Cxc) Business Flashcards

1
Q

4 ways in which economic activity developed

A

To satisfy three basic needs:foods,clothes,shelter

Direct production: providing needs without the help of others

Subsistent economy:production just enough for survival

Surplus:producing more than required

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2
Q

What is barter system

A

The exchange of goods and services without the use of money

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3
Q

Define trade

A

The buying and selling of goods and services

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4
Q

Define demands

A

The willingness of consumers to purchase goods and services at a particular prize

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5
Q

Define Supply

A

The willingness to produce at a particular price

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6
Q

ADVANTAGES OF BARTER

A

allowed for the disposal of surplus

Increased productivity which resulted in more wealth creation

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7
Q

DISADVANTAGES OF BARTER

A

Double coincidence

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8
Q

What is money

A

Any commodity that can be used as a medium of exchange and a unit of account

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9
Q

Give some examples of early money

A

Spearheads
Shells
Teeth
Beads
Animals

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10
Q

What is bill of exchange

A

An unconditional order in writing issued by a person or a business instructing the person in who’s name it is drawn to pay a fixed amount of money to the drawer or a third party

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11
Q

What is a credit card

A

A financial instrument of payment issued by commercial banks it also gives the holder access to goods and services on credit

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12
Q

Define commerce

A

Using the internet to conduct business

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13
Q

Define bank drafts

A

A cheque drawn by a bank on its own funds

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14
Q

What is a business

A

A business is a organization or entity that is providing good and services or both with the aim of making a profit

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15
Q

Reasons for establishing a business?

A

To obtain power,influence and status

To work for one self and to be one owns boss

To gain personal freedom

To lay foundation for a family situation

To respond to changes in personal situations

To put a creative idea into operation

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16
Q

Functions of the business

A

To provide goods or services
To create employment
To provide income for the govt

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17
Q

What is a stakeholder in the business

A

Everyone who has an interest in the business

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18
Q

Role of mangers

A

To plan,organize,control and protect the interest of owners and investors

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19
Q

Roles of employees

A

Carry out various activities assigned to them

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20
Q

Role of board of directors

A

Represents the interest of all stakeholders in ensuring the business is successful

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21
Q

Roles of the owner

A

Expect managers to demonstrate professionalism as they expect a return on their investment

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22
Q

List some external stakeholders

A

Customers
Creditors
Government
The community

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23
Q

Internal stake holders

A

Managers
Employees board of directors
Owners

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24
Q

Roles of the customer

A

The support the activity of the business thereby giving life to the business

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25
Role of the creditor
Provide resources the business need to produce goods and services
26
Roles of the government
Regulates businesses and the environment in which they operate
27
The role of the community
The business should be a good cooperate citizen in the community in which it operates
28
What is private sector
Refers to that part of the economy owned and controlled by private individuals and firms
29
What is public sectors
Refers to that part of the economic and administrative life of a country through which certain goods and services are delivered by the government
30
Types of businesses in the private sector
Sale propirtorship/trader ship
31
Advantages of sale proprietorship
Easy to establish and manage,decision making easy, profits are not shared
32
Disadvantages of sale proprietorship
Unlimited liability which you incur all the loss of the business Lack of competitiveness Problems in raising capital
33
What is partnership?
A business jointly operated by Individual
34
How many persons can form a partnership business?
Two to twenty persons
35
Characteristics of partnership
Provide financial capital needed Sharing of profit and loss and liability
36
Types of trade agreements
Bilateral and multilateral
37
Explain bilateral
Trade between two countries
38
Explain multilateral trade
Trade among a number of countries
39
Benefits of engaging a trade
The ability of a country to produce good at a lower marginal and opportunity cost that’s another country
40
Name 3 businesses that doesn’t exists to make a profit
Govt owned schools Churches Service owned clubs
41
What is a entrepreneur
An individual who takes a risk by investing resources in building a business with the aim to make a profit
42
What is tele banking
Carrying out of banking via a telecommunication network
43
Where do private sectors get money from to start a business
Investors Commercial bank loans Personal money
44
Where does the government get money from to provide goods n services
Grants Treasury bills Taxation Barrowing Bonds
45
Wbat is sole proprietorship
A business that is owned and operated by one person,often small business and very little startup capital needed
46
What is partnership deed
A major legal document that is filled out and submitted to the registrator of companies
47
Major types of partnership
General partnership General unlimited partnership General limited partnership
48
General partnership
May have 2 sleeping partners which only contributes capital but does not get involved in the daily running of the business
49
General unlimited partnership
All the partners have responsibility for the daily running of the business
50
General limited partnership
Governed by the partnership act It’s not a legal entity separated from its owners Atleast one partner has unlimited liability Inactive partners stand to bear a great loss
51
Coorperatives
Organizations formed by groups with similar objectives and interests
52
Retail cooperatives
Members learn up to provide Ensure goods are in adequate supply at all times
53
Financial cooperatives
Brings together persons with common interests
54
Financing a cooperative
Purchasing of shares One member one vote
55
Companies
Governed by the companies act (legal documents which outlines how a company should be operated under the laws of the company)
56
Enterprise
Generally a large business organization A multinational or transnational corporation
57
Major types of companies
One man/one person company Legal entity Owned and operated by one person/one share holder
58
Limited liability company
Investors are only liable up to the amount they invested
59
Characteristics of limited liability company
Financed by government agencies Companies must include the word limited(LTD) Accounts must be audited Must keep proper accounting records to be checked by the authorities
60
Private unlimited liability company
Owners or share holders assume unlimited liability mostly found in legal and accounting firms
61
Public limited company
An cooperated body:it is constituted as a legal entity and its therefore separate and apart from the persons who own it
62
Characteristics of public limited
Funded financial institutions By the use of bonds and debentures to raise funds

Principle Of Business (3 decks)

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