private sector and sole proportership

Question 1

Private sector organizations

Answer 1

Private sector organizations largely focus on satisfying the wants of consumers . Their main goal is therefor to maximize profit.

Question 2

The sole proprietorship

Answer 2

Sole proprietorship is a type of business structure in which an individual owns and operates the business.

Question 3

Characteristics of sole proprietorship

Answer 3

1. Owned by one person
2. very small in size
3. Has unlimited liability-Unlimited liability is when one or more business owners or partners are liable for their company’s debts and tax compliance
4. easy to form with minimal start up capital and legal requirements

Question 4

Advantages and disadvantages of

Answer 4

Advantages

1. All profits goes to the owner

2.Decisions can be made easily

3. Simple organizational structure

Disadvantages

1.The owner has unlimited liability

2. The owner must assume all roles in the business ( manager, accountant, cleaner , driver etc )

3.lack of continuality if the owner dies the business also dies.