Com Flashcards
(30 cards)
What is business entity ?
An individual or a group of individuals working together to produce goods and services to fulfill human needs and wants.
Describe needs & wants
Needs are basic requirements for survival. Needs are limited.
Wants are desires for goods and services, they are not essentials.
Difference between needs & wants
Needs are essentials and common to all. But wants are common to all and not essentials.
List out 4 business activities.
•Production
•Distribution
•Trade
•Marketing
Define trade and types of trade.
Trade is exchanging goods to another, there are 2 types of trade they are Domestic trade and International trade.
Define each 2 types of trade.
Domestic trade is the exchange that you do within the boundaries of a country. And international trade is the exchange you do with foreign countries.
What are the 2 types of Domestic trade?
Whole sale trade and Retail trade.
Define wholesale trade and Retail trade.
Wholesale trade is selling to a a person who has an intention to resale(retailer). And Retail trade is selling goods directly to the customer for final consumption.
What are the 2 types of International trade?
Export trade and import trade.
Define Export and import.
Export is when a country sells its products to other countries.
Import is when a country purchases products from other countries.
What are the 5 supporting services (AIDS to TRADE)?
- Finance & banking
- Communication & advertising
- Warehousing
- Transportation
- Insurance
What do Banking services do?
They lend money to businesses to start and expand it. Also it provides services related to deposits and etc.
Write 2 advantages of transportation systems.
One is that you can send goods to one place to another. And the other is that it’s more effective and easy
What is warehousing?
Warehousing is the process of storing goods before their sold.
What is Insurance?
Insurance is an agreement that provides financial protection against any loss occurred in the organisation
The 2 sectors of Business organisations
- Private sector
- Public sector
List 6 private sector organisations
- Sole trader
- Partnerships
- Limited companies
- Joint venture
- Franchise
- Multinational companies
3 features of private sector and Public sector
Private sector:
1. Profit seeking
2. Financial by individual/ group, shares, loans and etc.
3. Managed by owners or board of directors
Public sector:
1. Service providers
2. Financed by taxation
3. Managed by the government
What are Public sector organisations ?
1.Co-operation
2.Authority
3.Department
4.Boards
What is Sole trader and provide 2 pros and cons.
Business owned by an individual. The 2 pros are that can enjoy profits alone and can make quick decisions. The 2 cons are that long hours of work so the quality of decisions will be bad and unlimited liability
3 features of Sole trader
•The business is owned by a single person
• Capital should be invested by the owner
• Owner can employ other people.
What is partnership ?
The relationship among persons conducting a business in common to earn profits
2 features of partnership
• Can have 2 or more partners
• Partnership Ordinance of 1890 affects the partnership
What are the 2 types of business environments ?
- Internet environment
- External environment
