AOS 1 Business foundations

Question 1

private limited company

Answer 1

an incorporated business that does not usually sell its shares to the public to raise capital to operate the business, but has limited liability.

Question 2

What is a shareholder?

Answer 2

A person who holds at least one share in a company.

Question 3

What is a sole trader?

Answer 3

A business owned and operated by one person.

Question 4

What is incorporation?

Answer 4

The process that businesses go through to become a registered company and a separate legal entity from the owner/shareholder.

Question 5

What does limited liability refer to?

Answer 5

When the shareholders in a company will not be held personally responsible for the debts of that business.

Question 6

What is liquidation?

Answer 6

The process of selling off the assets of a business in order to repay creditors, with any assets remaining to be distributed among shareholders.

Question 7

What is a private limited company?

Answer 7

An incorporated business that does not usually sell its shares to the public to raise capital to operate the business, but has limited liability.

Question 8

Who are the directors of a company?

Answer 8

The people who have overall responsibility for managing the company’s business activities.

Question 9

What are assets?

Answer 9

Items of value owned by a business.

Question 10

What is a public listed company?

Answer 10

An incorporated business with a minimum of one shareholder (and no maximum), and whose shares are openly traded on the Australian Securities Exchange.

Question 11

What is a social enterprise?

Answer 11

A business with the objective of fulfilling a social need.

Question 12

What is a government business enterprise (GBE)?

Answer 12

A type of business that is government owned and operated.

Question 13

What is revenue?

Answer 13

The income that a business earns from the sale of goods and services.

Question 14

What is market share?

Answer 14

The proportion of total sales in a given market or industry that is controlled or held by a business, calculated for a specific period of time.

Question 15

What is efficiency?

Answer 15

How well a business uses resources to achieve objectives.

Question 16

What is effectiveness?

Answer 16

The degree to which a business has achieved its stated objectives.

Question 17

Who are stakeholders?

Answer 17

Groups and individuals who interact with the business and have a vested interest in its activities.

Question 18

Who are suppliers?

Answer 18

Businesses or individuals who supply materials and other resources to a business so that it can conduct its operations.

Question 19

What is corporate social responsibility?

Answer 19

The obligations a business has over and above its legal responsibilities.

Question 20

What are interpersonal skills?

Answer 20

The ability to deal or liase with people and build positive relationships with staff.

Question 21

What is corporate culture?

Answer 21

The values, ideas, expectations, and beliefs shared by members of the business.

Question 22

What is a laissez-faire management style?

Answer 22

One where the employees assume total responsibility for, and control of, workplace operations.

Question 23

What are management skills?

Answer 23

The abilities or competencies that managers use to achieve business objectives.

Question 24

What is communication in a business context?

Answer 24

The ability to transfer information from a sender to a receiver, and to listen to feedback.

Question 25

What is delegation?

Answer 25

The ability to transfer authority and responsibility from a manager to an employee to carry out specific activities.

Question 26

What is planning?

Answer 26

The ability to define business objectives and decide on the methods or strategies to achieve them.

Question 27

What is leadership?

Answer 27

The ability to influence or motivate people to work towards the achievement of business objectives.

Question 28

What is decision-making?

Answer 28

The ability to identify the options available and then choose a specific course of action from the alternatives.

Question 29

What is real corporate culture?

Answer 29

The culture that actually exists in practice.

Question 30

What is official corporate culture?

Answer 30

The written culture that a business aims to achieve.

Question 31

autocratic management style

Answer 31

one where the manager tells staff what decisions have been made

Question 32

persuasive management style

Answer 32

one where the manager attempts to 'sell' decisions made

Question 33

consultative management style

Answer 33

one where the manager consults employees before making decisions

Question 34

participative management style

Answer 34

one where managers unite staff to make decisions together

Question 35

Name an element of corporate culture

Answer 35

Heroes. These are employees who are singled out to represent the positive values that an owner is looking for in all employees. An example of this might be employee of the month.

Question 36

What is an expectation of shareholders?

Answer 36

Return on investment

Question 37

What are strengths and weaknesses of autocratic management style?

Answer 37

Strengths: Quick decisions

Question 38

What factors affect the appropriateness of management styles?

Answer 38

Nature of task, time, experience of employees, and manager personality and preference

Question 39

What are advantages and disadvantages of a social enterprise

Answer 39

Advantage- May attract customers as it is run for a good cause Disadvantage-May be difficult to expand business due to monet being use on the social cause

Question 40

What is a management style?

Answer 40

The way in which a manager makes decisions as well as how they lead and communicate with employees

Question 41

Business objective: to fulfil a social need

Answer 41

To deliver goods or services to customers that benefit the wellbeing of the community.

Question 42

Distinguish between official corporate culture and real corporate culture

Answer 42

Official corporate culture can be seen in official documents, while real corporate culture can be seen in employees actions, such as what uniform they wear

Question 43

what are business objectives?

Answer 43

A desired outcome that a business intends to achieve

Question 44

mission statement

Answer 44

summary of aims and values of a company

Question 45

Business objective: to fulfil a market need

Answer 45

To provide goods or services that satisfies a demand in a specific market