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Tuwan's Pob > Principles Of Business Two-five > Flashcards

Principles Of Business Two-five Flashcards

Principles of business chapter 2

1
Q

What are the two sectors the business fall into?

A

Businesses fall into municipal undertakings and State undertakings.

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2
Q

What are municipal undertakings?

A

These are Enterprise or Services operated on a commercial basis by local government authorities they are financed by local Taxation and charges are made for the use of their services or other commercial activities some examples are sportscenter’s, bus services, theaters, confidence Halls, art galleries and other culturally important facilities.
Sometimes they are subsidized by grants from the central government.

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3
Q

What are state undertakings?

A

These are Enterprises run and operated by the government on behalf of the public. These corporations are expected to at least break even however sometimes the May make profit

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4
Q

What are the profit made by state undertakings used for?

A

To pay interest on charges on Capital borrowed
Set aside for the future repayment of loans
Reinvested to improve or expand the services

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5
Q

Nationalization

A

This is when a company that had been in private ownership and then taken into public ownership by the government has been nationalized

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6
Q

Privatization

A

When a government old Enterprise is passed into private ownership it has been privatized

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7
Q

Reasons to State ownership?

A

To take Monopoly out of the private ownership for the good of all citizens

To keep a natural monopoly in public ownership

Sometimes the initial cost of setting up an Enterprise may be too high for private Enterprise

National Security may have to be protected to State ownership

To avoid equipment replication and duplication of services

To save and a ailing essential industry and protect jobs

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8
Q

Advantages of State ownership

A

The government has the resources to fund a vast essential industry

It ensures that essential services are always provided

Profit benefits the whole nation and opposed to a limited number of private individuals

The large-scale public corporations enables them to enjoy maximum economies of scale

Personal or appointed because of proven ability as opposed to that share in the ownership of the business

It enables the large sections of the economy to be planned to a single strategy

It reduces possible duplication of services and equipment

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9
Q

Disadvantages of State ownership

A

It can be over cautious due to the fact that they are answerable to the public

Local issues may be disregarded in favor of political objective

Losses have to be met by the taxpayer

A state’s Monopoly can lead to in efficiency and inefficient profit motive

The ultimate bosses are politicians who may not have the requirements to run a major Enterprise

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10
Q

The private sector

A

The private sector businesses are run for profit and not owned by the government they are owned by individuals or commercial companies

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11
Q

Who are the main forms of the private Enterprises?

A

The sole Trader
Partnerships
Cooperatives
Limited companies

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12
Q

Unlimited liability

A

In these circumstances if a formal to go bankrupt the investors would lose their personal assets, tikkun in order to pay off their debts

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13
Q

Limited liability

A

Italo’s person to invest in a business without having to face the risk of losing their personal assets if the company goes bankrupt I needs to pay debt

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14
Q

Sole Trader

A

The sole Trader is a popular form of business ownership where a personal service is provided

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15
Q

Proprietor

A

This is a singular person operating a business

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16
Q

advantages of a sole Trader

A

A small business will need less capital

When a profit is made it is divided by one person

You are your own boss and make all your own decisions and involved with every aspect of the business and all your clients

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17
Q

Partnerships

A

A partnership con involved between 2 to 20 people. A bank is not allowed to have more than 10 partners and some professional films

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18
Q

Advantages of a partnership

A

Offer a solution to some of the problems faced by a sole Trader for example multiple in a partnership means more expenses on knowledge, on some me have specialist knowledge such as accountancy

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19
Q

Some disadvantages of partnership

A

The partnership has unlimited liability, but the partnership does not necessarily have to face the depths equally

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20
Q

A partnership deed.

A

A partnership deed sets out the right of each partner regarding the division of the prophets and so on if such a deed does not exist then it is assumed that the profits or debts are shared equally.

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21
Q

What is a sleeping partner?

A

A sleeping partner is a partner that may be willing to introduce Capital into the business but however me not want to take an active part in its operation.

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22
Q

Is it possible to have limited partnership?

A

It is possible but at least one partner must have unlimited liability

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23
Q

Advantages of partnership

A

Easily formed

More people can contribute capital on a sole Trader have you ever

Greater Community than a sole Trader

Expenses and management of the business are shared

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24
Q

Disadvantages of partnership

A

Generally unlimited liability

Possible disagreements between partners

Each partner is liable for the debts of the business

20% membership limit restricts capital resources

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25
Q

Cooperatives

A

This is a special form of business organization they are Incorporated businesses that are owned and controlled by groups with special interest thus having common goals and interests

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26
Q

What are the four types of cooperatives?

A

Consumer cooperatives
Marketing cooperatives
Workers cooperatives
Producers cooperative

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27
Q

Consumer cooperatives

A

Are stores with share the net Prophets of business among members

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28
Q

Marketing cooperative

A

Are businesses which several individuals or small businesses combined sell their goods or services

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29
Q

Workers cooperatives

A

Are businesses that are owned and run by their own Workforce

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30
Q

Producers cooperative

A

Enable members who are involved in producing the same and similar products to cooperatively Market and sell their products

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31
Q

Cooperatives shares

A

The Cooperative sells shares to its members members cannot purchase more than 20% of the overall total

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32
Q

Private limited companies

A

A private limited company has to have a minimum of one member and there is no maximum

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33
Q

Can shares for a private limited company be shared publicly?

A

No, shareholders must be found privately

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34
Q

Public limited companies

A

Hello profit achieved is shared among his contributors and must incorporate the letters PLC in its title it takes a minimum of two people to form a public limited company and there is no maximum

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35
Q

Who is elected to participate in day-to-day operations of business in a public limited company

A

A board of directors is elected to take decisions on their behalf this board elect a chairperson to regulate their meetings

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36
Q

Advantages of public companies

A

Because they can advertise for imports of capital from the public in the form of shares public companies kind of tea in large quantities of capital and resources

Their large size enables them to enjoy economies of scale such as

The ability to purchase supplies in bulk, thus obtaining the most favorable prices
Purchasing the equipment that will save on labor costs
Ease of borrowing money and obtaining credit
A greater opportunity to undertake research programs which will enhance production and cost-saving operations

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37
Q

Disadvantages of public companies

A

When a public company becomes very large it can become burdened buy too much paperwork

It allows the possibility of the firm being taken over by another company that has managed to obtain a controlling number of shares

The public company has to send a copy of its account to the register of companies and to each of its shareholders therefore it is difficult for this type of company to keep its Affairs confidential

The management of a large company can become inefficient and overstaffed and therefore wasteful of resources

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38
Q

Setting up a limited company

A

If a company wishes to register the business names other than the names of the owner it must register with the Registrar of business names

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39
Q

Memorandum of Association

A

This document States the external relationships of the businesses such as the relationship between the company and others

The name of the business and its status, the address of the registered Office of the company, the objective of which the business is formed call Ma the liability of the owners, the amount of capital the company is registered under manner of which it is divided into shares
An association close, this is declaration signed by those forming the business confirming they wish to form the company and that they are prepared to teacup and pay for the number of shares shown on the phone by their name the minimum number of signatures is two

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40
Q

Articles of Association

A

The articles of Association outline the internal relationship of the business this is the broad way in which the internal organization will operate it is signed by the same people who signed a memorandum of Association

The promoters of the company must also make the following declarations and statements to the Registrar of companies

The right of the shareholders
The methods and manners of electing directors
The manner in which meetings are to be conducted
The division of profits weather
The remuneration, appointment and removal of auditors
The method of audits
The issue, transfer on the Forfeit of shares

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41
Q

Miscellaneous declaration

A

Is it was forming a company must also make a number of all the statements and declarations to the Registrar of companies

The amount of registered capital and the way it is divided into shares
the Declaration made under Oath by the company secretary or a director confirming that all requirements have been met

A list of the first directors
A statement of consistency by each director confirming they are willing to act in the capacity
The registered address of the company

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42
Q

Certificate of Incorporation

A

If the Registrar of companies is satisfied that all the requirements have been met this is issued

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43
Q

Franchises

A

A franchise is a form of business in which a phone that has a successful service or product enters into a contract to other relationship with another business

The contract allows the franchise to operate under the franchises name with the franchises guidance in exchange for a fee

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44
Q

Advantages of franchises

A

The reduce the setup risk for entrepreneurs

They usually Market in known, successful brand name and image

Banks are more likely to allow loans to a new entrepreneur are backed by a known, successful business

The franchise jeans an exclusive right to a Market within a specific area

The franchisor will have an established supplier relationship so the franchise does not need to create this

The franchisor provides considerable backup facilities such as training, marketing, advertising, promotional material and extensive advertising

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45
Q

Disadvantages of franchise

A

If the franchisor has not research the potential Market correctly the franchisee will suffer losses

Cost may be higher than expected

If franchise agreement includes restrictions and how the business should beer run this can restrict the franchisees freedom to adapt its approach to local market conditions

The franchisee must always adhere to the changes in operational technique

If the franchise that goes out of business this will have a direct effect on the franchise

It can sometimes be more difficult to sell a franchise business than a non franchise one

46
Q

Multi nationalist

A

This is a business operating internationally although its ownership is usually based in one country

47
Q

Advantages of multinationals

A

Cheap volleyball may be available in other countries

They provide a means of entering a tariff protected Market

The factors of production employed more effectively because multinationals raise competition levels

They promote advanced technology and training for higher technological skills

Increased teamwork and sharing goals are a feature of multinationals

A greater variety of product choice benefits consumers in all participating countries

Increase employment choices are promoted resulting in higher incomes

48
Q

Disadvantages of multinationals

A

Like all of Venus is the size of multinationals can be counterproductive

The multinational is motivated by self-interest rather than the interests of the host country

Multinationals can use their economic power in ways that are socially unacceptable for example exploration of cheap labor and diminishing raw materials and possibly ignoring environmental issues

49
Q

Economic system

A

Economy is it to him used to define a country in terms of that total composition of its economic activity

50
Q

Command economy

A

This is a socialist economy in this type of economy all the economic decisions are made by the government the state decide what will be produced how it is to be produced and how it should be allocated to customers

51
Q

Advantages of a command economy

A

The state ensures that the needs of the whole Community I met and not just the needs of those with the most wealth

State Control eliminate wasteful competition

The state will provide goods and services that private Enterprises would be unwilling to provide

It is not possible for a private Monopoly to develop

52
Q

Disadvantages of command economy

A

A free market and competition are discouraged

Too many non productive government officials are required to administer the system

Centralized production may not respond quickly enough to changing conditions and needs

Creativity and efficiency are not encouraged

53
Q

Free market economy

A

In a free-market economy there is little or no government interference in the economy it is based on the private ownership of the factors of production and the means of Distributing goods and services

Sometimes this economy is referred to as unplanned or free enterprise or laissez Fair

54
Q

Advantages of a free market economy

A

Free competition stimulates innovation and it keeps down price

Individuals are completely free to use the income and Libra to their best advantage

Consumers decide what will be produced by influencing Market forces

55
Q

Disadvantages of free market economy

A

It encourages inequality of wealth

Advertising can be used to create an artificially high demand for your products

The more powerful business may by out small ones. Reduce it’s competition.

Wealthy people are more able to purchase goods and services and influencer Market than the poor

Companies may be tempted to restrict supplies to keep prices artificially height

56
Q

Mixed economy

A

A mixed economy is it combination of elements from a free economy and a controlled economy it is a mixed system the means of production and Supply are shared between the private and public sectors

57
Q

Globalization

A

This can be seen as the intensification and spread of worldwide social, economic, cultural and political relationships among countries

58
Q

Production

A

This is a process and methods used by producers to transform inputs such as raw materials semi produce goods and even ideas, information or knowledge into goods and services

59
Q

Marketing

A

Refers to all processes involved in promoting and selling goods or services in the most profitable and efficient manner

60
Q

What are the four Ps of marketing

A

Product Promotion place and price

61
Q

Finance

A

It is possibly the most important resource of all business functional areas

62
Q

What is startup capital?

A

This is the finances needed to start a business

63
Q

Human resources

A

Human resources or HR is concerned with managing people within an organization

It includes six areas, recruitment, safety, employee relations, compensation and benefits, compliance, training and development,

64
Q

Research and development

A

This is the investigate activity it business car is out with the aim of getting new knowledge that it can use to create new products or systems

65
Q

Stakeholders of a business

A

A stakeholder is any person or group of people that has an interest in the business and its activities

66
Q

Different stakeholders

A

Customers of a business a stakeholders, suppliers to a business a stick holders, employees at businesses are stakeholders
The local community all stakeholders
Government is also a stakeholder

67
Q

Legal aspects of a business

A

These are of course many ethical and legal issues that an authentic business will want to consider

68
Q

Money laundering

A

This is an illegal activity that has become increasingly frequent and today’s Global business environment it is a term used to describe the process by which criminals disguise the original ownership of the prophets all of the criminal conduct.

69
Q

National insurance and income tax

A

One of the legal obligations of a business is to collect money on behalf of the government. For example a business will deduct from the employee’s wages for contribution

70
Q

Value added or consumption tax

A

This falls under the category of Monies collected on the government’s behalf, how business. Feels to make the obligatory payment defrauded both the government and their customers.

71
Q

Principles related to forming a business

A

Are responsible business wouldn’t want to establish a code of ethics including policies on environmental issues and protecting personal data related to employees as well as a code of conduct to guide employees in their obligations.

72
Q

Code of ethics

A

Formulating a code of ethics should be an important aspect of a business establishment especially with large organizations employing many people. The code of ethics is an organization’s overall principles that guide its decisions and actions in relation to external or internal issues.

73
Q

Code of conduct

A

A code of conduct is an internal document that is the practical application of the code of ethics, it is essentially a set of rules and guidelines that describe how people within the organization I expected to behave. All Personnel are given a copy and are required to sign an acknowledgement of it.

74
Q

Code of practice

A

A code of practice is a set of written rules which explain how people working in a particular profession should behave as they carry out their work, this is intended to reflect good practices and is generally recognized by the whole profession.

75
Q

Consequences of unethical or illegal practices

A

A Miss deed will be associated with your name of this mess for a very long time, the government May impose taxes aimed at curbing activities for example those causing pollution.

76
Q

Negative effects of unethical and illegal practices

A

Once a business has acted illegally or unethical e the business loses credibility

77
Q

Consumerism

A

This term refers to an organized movement to protect the interest of customers by influencing businesses to act in a socially responsible manner.

78
Q

What are some legislative demands that Goods must be?

A
  • To be as described
  • Fit for purpose which is made known to the seller by customer
  • Or merchantable
79
Q

Pressure groups

A

These are groups that seek to persuade the central government, local government, businesses or some of the organization to recognize their views and respond to them

80
Q

The functions of management

A

They fulfill that same functions planning, organizing, directing, controlling, coordinating, delegating and motivating

81
Q

Planning

A

This involves mopping out how to achieve particular goals

82
Q

Organizing

A

After a plant has been established managers need to structure their teams or departments and resources according to the plan

83
Q

Directing

A

Managers have to ensure that all of the elements within the teams are aware of the targets within the overall plan and deadlines that apply

84
Q

Controlling

A

Managers have to try to evaluate and measure the work of all of the staff within their team to ensure that everyone is on target to meet the Eames and work identified at the planning stage

85
Q

Controlling

A

Managers have to try to evaluate and measure the work of all of the staff within their team to ensure that everyone is on target to meet the Eames and work identified at the planning stage

86
Q

Coordinating

A

An effective manager will ensure that all of the personnel and departments are working together to achieve their overall aims

87
Q

Delegating

A

Delegating refers to giving a subordinate, a person under the control or direction of another, the authority to oversee a task assigned to them by the manager

88
Q

Motivating

A

Motivation refers to the reasons for behaving in a particular way in the case of business of course managers wanted their subordinates to give their best effort to achieving the plan.

89
Q

Management responsibilities

A

Managers whether they are employed by a small business or conglomerates, have responsibilities to the owners and shareholders, employees, Society, customers in government

90
Q

Responsibilities to owners and shareholders

A

Managers are responsible to owners and shareholders to ensure that the goods or services the business provides a lot of good quality, produce economically and on time underachieving profit

91
Q

Responsibilities to employees

A

Managers must ensure that workers are provided with adequate and safe working conditions they also must make notice of workers concerns and problems and give them respect.

92
Q

Responsibilities to society

A

Manages have a two-fold responsibility to society. We have an obligation to ensure the business does not damage the environment as well as having a responsibility to society to try to give back some of the profit

93
Q

Responsibility to customers

A

The business has an obligation to provide goods or services of decent and safe quality within an agreed. Of time at a fair and economic price

94
Q

Responsibilities to government

A

Managers fulfill its responsibility to government by ensuring the business is adhering to legislation and behaving in a manner that is compatible with trading practices of both their own country and those of International Community

95
Q

Organizational charts

A

An organizational chart serves a practical purpose because at a glance it shows the chain of command or the span of control.

96
Q

Chain of command

A

Most companies are organized in the form of a pyramid the person at the top of the pyramid has the most Authority, and the steps down the pyramid indicate less Authority.

97
Q

Leadership

A

The term leadership refers to the ability of a person to motivate and influence others to work constructively towards the effectiveness and success of the organization in which they are involved

98
Q

Qualities of a good leader

A

A good leader tends to be people oriented, with their main aim being to motivate others to achieve goals. Leaders tend to be risk-takers when courage others to participate through consultation and encouragement

99
Q

Characteristics of a good leader

A 
Honesty 
Flexibility 
Focus 
 Trustworthiness 
 Intelligence
100
Q

Leadership styles

A

Autocratic
Democratic
Laissez-faire

101
Q

Autocratic leadership

A

The leader is the absolute Authority on all matters deciding what to do despite what others may think

102
Q

Democratic Leadership

A

The leader will consult with those likely to be affected or involved before making a decision, although the leader will reserve the right not to act on a majority View

103
Q

Laissez-faire leadership

A

In this style of leadership the leader gives limited direction to the subordinate workers they are given board objectives and then left to achieve them in the way they think is best

104
Q

The conflict of pay within an organization

A

This can arise when workers feel that their pay, including benefits, does not compare fairly with people doing the same level of work in other firms, or even where pay is not comparable to colleagues in the same business

105
Q

Conflicts of working conditions in a business

A

This occurs when workers feel that the condition in the workplace are inadequate, unsafe or unhealthy

106
Q

Conflict in a business with internal changes

A

Changes in working practices or the implementation of a new technology can become a source of conflict

107
Q

Conflict regarding interpersonal relationships

A

Disagreements between supervisor and employee or between work colleagues can also result in conflict

108
Q

Communication conflict in business

A

This may lead to conflict when instructions or tasks or expectations are not clearly expressed

109
Q

The conflict of harassment in business

A

Sexual, racial, or even just discourtesy. Such conflicts are not only harmful to the organization, but also illegal

110
Q

Conflict strategies by employers

A

They may lock out workers
They can encourage strikebreakers
They may attempt to prevent employees from joining or forming a union

111
Q

Conflict strategies by employees

A 
Striking or withdrawing their labor
Working to rule
Organizing slow working
Instituting an overtime ban
Executing a sidon
Using a sick out option

Tuwan's Pob (6 decks)

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