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Business Studies - Year 11 > The Nature of a Business > Flashcards

The Nature of a Business Flashcards

1
Q

What is the purpose of a business?

A

Businesses make products (goods/services) in the pursuit of profit

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2
Q

What are the characteristics of goods?

A

Goods are tangible, and can be perishable or durable

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3
Q

What does the value of a service depend on?

A

The skill level involved
Convenience
Time Taken
The reputation of the service provider

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4
Q

What is the profit formula?

A

Profit = Total Revenue - Total Costs

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5
Q

What is entrepreneurship?

A

Entrepreneurship occurs when a businesses creates wealth by focussing on a vision and bringing together all the inputs required to visualise that vision

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6
Q

What are the qualities of an entrepreneur?

A

Drive, Determination and Creativity

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7
Q

What is wealth?

A

Wealth is the total amount of assets owned by a person or business

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8
Q

What are the features of small businesses?

A

Businesses of less than 20 employees
Micro businesses of 5 or less people
Non-employing businesses

Small Businesses = Less than $200,000

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9
Q

What are the features of medium businesses?

A

Employ more than 20 but less than 200 people

Between $200,000-$2 million

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10
Q

What are the features of large businesses?

A

Employ more than 200 people

Above $2 million

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11
Q

Primary Industry

A

Businesses involved in the acquisition of raw materials

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12
Q

Secondary Industry

A

Businesses that use raw materials, combined with labour and capital equipment, to create finished products

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13
Q

Tertiary Industry

A

Businesses that are concerned with retail and the provision of services

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14
Q

Quaternary Industry

A

Businesses that that provide information services to their customers

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15
Q

Quinary Industry

A

Businesses that provide services typically performed in the home

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16
Q

What is a sole trader?

A

A sole trader business is owned and managed by one person

It is not incorporated, which means that the business and its owner are not separate

17
Q

How many sole traders are there, and how many fail?

A

There were 561,000 sole trader businesses in Australia in 2016 - 51% lasted fewer than 4 years

18
Q

What is a partnership?

A

A partnership is a businesses run by between 2 and 20 people

There may be a partnership agreement between the parties

Like a sole trader, partnerships have unlimited liability - they are personally liable for all debt

19
Q

What is agency?

A

Contracts or agreements entered into by any partner is binding on all other partners

20
Q

How many partnerships are there, and how many fail?

A

There were 276,300 partnerships in Australia in 2016 - 36.3% lasted fewer than 4 years

21
Q

What is incorporation?

A

A business structure that separate the owners from the business because the business is a separate legal entity

22
Q

What is a Private Company?

A

A private company is a legal structure with 1 to 50 shareholders

They are privately owned and are bound by the Corporations Australia Act 2001

They are very large, and do not have to disclose their financial data

They have the letters Pty Ltd after their name

23
Q

What is a Public Company?

A

Legal structures with at least 1 and up to an unlimited number of shareholders

They follow the Corporations Act 2001, monitored by ASIC

Public companies are listed on the Australian Securities Exchange

24
Q

What is a Government Enterprise?

A

Businesses run by the government, but treated like companies with profit motive

25
Q

What is Privatisation?

A

When the government turns a government provided service into a public company

26
Q

What are the four classifications of businesses?

A

Size

Reach

Industry

Legal Structure

27
Q

What are the different reaches of a business?

A

Local Business

National Business

Global Business

Business Studies - Year 11 (7 decks)

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