business Flashcards
(36 cards)
What is Business?
The activity of producing goods and services to satisfy the needs and wants of people.
What are the types of business activities?
- Production: Creating goods and services.
- Marketing: Promoting and selling goods and services.
- Finance: Managing money within the business.
- Human Resources: Managing employees.
What are the three business sectors?
- Primary Sector: Extracting raw materials (e.g., farming, mining).
- Secondary Sector: Manufacturing and processing (e.g., factories).
- Tertiary Sector: Providing services (e.g., retail, banking, healthcare).
What is the economic importance of business?
- Provides goods and services.
- Creates employment.
- Generates tax revenue.
- Contributes to national and global economies.
What is a Sole Trader?
A business owned and operated by one person.
What are the advantages of a Sole Trader?
- Simple to set up.
- Full control.
What are the disadvantages of a Sole Trader?
- Unlimited liability.
- Difficulty in raising capital.
What is a Partnership?
A business owned by two or more people.
What are the advantages of a Partnership?
- Shared responsibility.
- More capital.
What are the disadvantages of a Partnership?
- Shared profits.
- Disagreements.
What is a Private Limited Company (Ltd)?
A company owned by shareholders, but shares are not sold to the public.
What are the advantages of a Private Limited Company?
- Limited liability.
- Easier to raise capital.
What are the disadvantages of a Private Limited Company?
- More regulation.
- Higher setup costs.
What is a Public Limited Company (PLC)?
A company that can sell shares to the public.
What are the advantages of a Public Limited Company?
- Easy access to capital through the stock market.
What are the disadvantages of a Public Limited Company?
- Greater public scrutiny.
- Costly to establish.
What is a Business Plan?
A document that outlines the goals, strategies, and financial projections for a business.
What are the objectives of a Business Plan?
- Attract investors or secure financing.
- Guide business operations and set goals.
- Analyze the competition and market.
What are the Four P’s of Marketing?
- Product: What is being sold.
- Price: How much the product costs.
- Place: Distribution channels.
- Promotion: Advertising, sales promotions.
What is Market Research?
The process of gathering and analyzing data about consumer needs and preferences.
What are the sources of finance?
- Internal: Retained profits, sale of assets.
- External: Loans, grants, share capital (for companies).
What does an Income Statement show?
A company’s profitability over a period.
What is a Balance Sheet?
Provides a snapshot of a company’s financial position, listing assets, liabilities, and shareholders’ equity.
What is Break-even Analysis?
The point at which total revenue equals total costs.
