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Principle Of Business > Pob (Cxc) Business > Flashcards

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
Q

Role of the creditor

A

Provide resources the business need to produce goods and services

26
Q

Roles of the government

A

Regulates businesses and the environment in which they operate

27
Q

The role of the community

A

The business should be a good cooperate citizen in the community in which it operates

28
Q

What is private sector

A

Refers to that part of the economy owned and controlled by private individuals and firms

29
Q

What is public sectors

A

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
Q

Types of businesses in the private sector

A

Sale propirtorship/trader ship

31
Q

Advantages of sale proprietorship

A

Easy to establish and manage,decision making easy, profits are not shared

32
Q

Disadvantages of sale proprietorship

A

Unlimited liability which you incur all the loss of the business

Lack of competitiveness
Problems in raising capital

33
Q

What is partnership?

A

A business jointly operated by Individual

34
Q

How many persons can form a partnership business?

A

Two to twenty persons

35
Q

Characteristics of partnership

A

Provide financial capital needed
Sharing of profit and loss and liability

36
Q

Types of trade agreements

A

Bilateral and multilateral

37
Q

Explain bilateral

A

Trade between two countries

38
Q

Explain multilateral trade

A

Trade among a number of countries

39
Q

Benefits of engaging a trade

A

The ability of a country to produce good at a lower marginal and opportunity cost that’s another country

40
Q

Name 3 businesses that doesn’t exists to make a profit

A

Govt owned schools
Churches
Service owned clubs

41
Q

What is a entrepreneur

A

An individual who takes a risk by investing resources in building a business with the aim to make a profit

42
Q

What is tele banking

A

Carrying out of banking via a telecommunication network

43
Q

Where do private sectors get money from to start a business

A

Investors
Commercial bank loans
Personal money

44
Q

Where does the government get money from to provide goods n services

A

Grants
Treasury bills
Taxation
Barrowing
Bonds

45
Q

Wbat is sole proprietorship

A

A business that is owned and operated by one person,often small business and very little startup capital needed

46
Q

What is partnership deed

A

A major legal document that is filled out and submitted to the registrator of companies

47
Q

Major types of partnership

A

General partnership
General unlimited partnership
General limited partnership

48
Q

General partnership

A

May have 2 sleeping partners which only contributes capital but does not get involved in the daily running of the business

49
Q

General unlimited partnership

A

All the partners have responsibility for the daily running of the business

50
Q

General limited partnership

A

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
Q

Coorperatives

A

Organizations formed by groups with similar objectives and interests

52
Q

Retail cooperatives

A

Members learn up to provide
Ensure goods are in adequate supply at all times

53
Q

Financial cooperatives

A

Brings together persons with common interests

54
Q

Financing a cooperative

A

Purchasing of shares
One member one vote

55
Q

Companies

A

Governed by the companies act (legal documents which outlines how a company should be operated under the laws of the company)

56
Q

Enterprise

A

Generally a large business organization

A multinational or transnational corporation

57
Q

Major types of companies

A

One man/one person company
Legal entity
Owned and operated by one person/one share holder

58
Q

Limited liability company

A

Investors are only liable up to the amount they invested

59
Q

Characteristics of limited liability company

A

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
Q

Private unlimited liability company

A

Owners or share holders assume unlimited liability mostly found in legal and accounting firms

61
Q

Public limited company

A

An cooperated body:it is constituted as a legal entity and its therefore separate and apart from the persons who own it

62
Q

Characteristics of public limited

A

Funded financial institutions

By the use of bonds and debentures to raise funds

Principle Of Business (3 decks)

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