Types of business

Question 1

What are the features of a multinational?

Answer 1

• subsidiaries in more than one country
• distinct home base country
• global brand that can dominate markets
• influence local economies
• provide cultural variations

Question 2

What are the benefits of a multinational?

Answer 2

• cheaper premises and land
• avoid or minimum tax to be paid
• avoid restrictions on imports
• grants to encourage location in a specific location
• being larger reduces takeover risk
• achieve economies of sake

Question 3

What are the drawbacks of multinationals ?

Answer 3

• legislation may be different in other countries
• cultural differences that business must be sensitive to
• linguists may need to be employed

Question 4

Describe private limited compamnies

Answer 4

Shares private, one shareholder, must produce documents

• limiter liability, no control lost, experience from BOD
• profits shared, shares ant be sold publicly, must abide by companies act

Question 5

Describe public limited companies

Answer 5

Stock market, tel shareholders, must produce documents

• limited liability, lots of finance and easy to borrow, dominate markets,
• no control of who buys, must abide by companies act, set up costs high

Question 6

What are objectives of a private sector organisation?

Answer 6

• profit maximisation
• satisficing
• managerial objectives
• survival
• csr

Question 7

Describe csr policies

Answer 7

Living wage
Ethical marketing and suppliers
Reduce waste by recycling
Less packaging

Question 8

What are the benefits of positive csr?

Answer 8

• better public image
• ensure long term survival
• exceeding government targets
• market growth

Question 9

Problems of poor csr ?

Answer 9

Bad reputation
Unwilling investors
Interference from pressure groups

Question 10

Objectives of public sector?

Answer 10

Highest quality of service to everyone
Make best use of taxpayers money
Local or government objectives
Social responsibility

Question 11

Benefits of social enterprise?

Answer 11

Attracts responsible staff and customers
Some funding only available to social enterprises
Could sell shares

Question 12

Drawbacks of social enterprise?

Answer 12

Risks of all businesses
Staff earn less than private or public sectors
Depend heavily on volunteers

Question 13

What are the objectives of a third sector organisation?

Answer 13

Provide support for worthy causes
Raise awareness of worthy causes
Provide best possible service
Use surplus to help the cause