Summative test 1 Flashcards
Economic and social roles
Profit, employment, incomes, choice, innovation, entrepreneurship, wealth, quality of life
What is PIECE
Production, Investment, Employment, Careers, Enterprise
What are some financial goals of business?
- Maximise profits
- Maximise growth
- Production efficiency
- Improve share price
- Improve market share
What are some non-financial goals of business?
- Social goals
- Economic goals (sustainable development)
- Personal goals of owners/managers
What are SMART goals?
Specific, Measurable, Attainable, Relevant, Time bound
What are examples of Coles SMART goals?
100% renewable energy by July 2025
$50m nurture fund to be spent on SME at $500k per project
Net zero greenhouse gasses by 2050
3 types of business sizes
Local business
National business
Global business
3 types of industry sectors
Primary - collecting natural resources
Secondary - take output from primary business and further process it into a finished or semi finished product
Tertiary - services like lawyers, health professionals
Legal structures of business
Sole trader
Partnership
Company - private/public
External influence of business (PESTLE)
Political, Economic (economic cycle trough expansion peak contraction etc), Social (attitudes like fashion and culture like veganism), Technological, Legal and Environmental
Internal influences on business
Product (type of product produced), Location (affects sales due to visibility for retail, passing trade, costs etc), Resource, Management, Business Culture (elements include values, symbols, rituals/rites/celebrations, heroes)
What is an unincorporated legal structure
No separate legal existence from owners, either a sole trader or partnership.
What are some advantages of a public company
-Listed on the Australian Securities Exchange
-General public can buy and sell shares
-Generally large businesses such as Coles and QANTAS
- Incorporated, meaning business is seperate from their owners legally (limited liability)
- perpetual succession
What are some advantages of being a sole trader
low cost of entry and simple to establish
less costly to operate
the owner has complete control and can keep all of the profits
less government regulation
no tax on profits, only on personal income
What are some disadvantages of being a sole trader
unlimited liability
no perpetual succession (business ends when owner dies)
burden of management
difficult to raise finance for expansion
