Business Ownership Flashcards
Primary activity
Natural resources or raw materials. E.g-lobster fishing
Secondary activity
Manufacturing of raw materials into finished products
Tertiary activity
Providing a service, selling and distributing finished products
Private sector
Owned by private individuals or shareholders
Public sector
Owned and funded by the government. E.g-BBC
Third sector
Charities, social enterprises and voluntary groups
Advantage & disadvantage of sole trader
Total control. Unlimited liability
Advantage & Disadvantage of partnership
Increased skills. Limited finance
Advantage & Disadvantage of Private Limited company
Limited liability. Shares cannot be sold to general public which limits finance
Advantage & Disadvantage of PLC
Greater availability of finance. Larger threat of takeover
Advantage & Disadvantage of State Government owned
Continuity. Diseconomies of scale
Diseconomies of scale
When company or business grows so large that the costs per unit increase
CIC (Community Interest Companies)
Benefit community with social purpose rather than earning profits for shareholders
Advantage & Disadvantage of CIC
No dividends. Financial accounts published
Provision
any funds set aside from company profits for a specific purpose
