Unit 23 - Forms Of A Business 2 Flashcards
Def: private equity company
A business owned by private individuals backed by financial institutions
Def: public limited company
Company owned by share holders where shares can be traded openly on stock markets
Def: stock market
A market for second hand shares
Def: stock market flotation/ initial public offering (IPO)
Process of a company going public - market shares available for first time
Advantages and disadvantages of public limited company
Huge amount of money raised
Production costs lower ( economies of scale)
Size allows to dominate market
Easier to raise finance
Setting up costs can be expensive
Anyone can buy shares so an outsider could take control
Members of public can inspect all company accounts
Size doesn’t allow company to connects with consumers
Inflexible
