chapter 2 business sector and types of business

Question 1

What is a private sector

Answer 1

a business that is owned and ran by private individuals usually for profit

Question 2

what is the public sector

Answer 2

a business owned and ran by the government whose objective is to provide a service rather than make a profit

Question 3

What is a sole trader

Answer 3

Owned and ran by one person

Question 4

advantages and disadvantages of sole traders

Answer 4

+ complete decision making power and control over the business
+ easy and cheap to start up
- owner is responsible for any debts or loses
- business may struggle to grow

Question 5

What is the third sector

Answer 5

Usually a charity, community group
They are motivated by the desire to achieve social goals

Question 6

What is unlimited liability

Answer 6

the owner is personally liable for all business debts and bears the full financial risk

Question 7

What is limited liability

Answer 7

Personal assets are protected
financial responsibility is limited