Principles Of Business Two-five

Question 1

What are the two sectors the business fall into?

Answer 1

Businesses fall into municipal undertakings and State undertakings.

Question 2

What are municipal undertakings?

Answer 2

These are Enterprise or Services operated on a commercial basis by local government authorities they are financed by local Taxation and charges are made for the use of their services or other commercial activities some examples are sportscenter’s, bus services, theaters, confidence Halls, art galleries and other culturally important facilities.
Sometimes they are subsidized by grants from the central government.

Question 3

What are state undertakings?

Answer 3

These are Enterprises run and operated by the government on behalf of the public. These corporations are expected to at least break even however sometimes the May make profit

Question 4

What are the profit made by state undertakings used for?

Answer 4

To pay interest on charges on Capital borrowed
Set aside for the future repayment of loans
Reinvested to improve or expand the services

Question 5

Nationalization

Answer 5

This is when a company that had been in private ownership and then taken into public ownership by the government has been nationalized

Question 6

Privatization

Answer 6

When a government old Enterprise is passed into private ownership it has been privatized

Question 7

Reasons to State ownership?

Answer 7

To take Monopoly out of the private ownership for the good of all citizens

To keep a natural monopoly in public ownership

Sometimes the initial cost of setting up an Enterprise may be too high for private Enterprise

National Security may have to be protected to State ownership

To avoid equipment replication and duplication of services

To save and a ailing essential industry and protect jobs

Question 8

Advantages of State ownership

Answer 8

The government has the resources to fund a vast essential industry

It ensures that essential services are always provided

Profit benefits the whole nation and opposed to a limited number of private individuals

The large-scale public corporations enables them to enjoy maximum economies of scale

Personal or appointed because of proven ability as opposed to that share in the ownership of the business

It enables the large sections of the economy to be planned to a single strategy

It reduces possible duplication of services and equipment

Question 9

Disadvantages of State ownership

Answer 9

It can be over cautious due to the fact that they are answerable to the public

Local issues may be disregarded in favor of political objective

Losses have to be met by the taxpayer

A state’s Monopoly can lead to in efficiency and inefficient profit motive

The ultimate bosses are politicians who may not have the requirements to run a major Enterprise

Question 10

The private sector

Answer 10

The private sector businesses are run for profit and not owned by the government they are owned by individuals or commercial companies

Question 11

Who are the main forms of the private Enterprises?

Answer 11

The sole Trader
Partnerships
Cooperatives
Limited companies

Question 12

Unlimited liability

Answer 12

In these circumstances if a formal to go bankrupt the investors would lose their personal assets, tikkun in order to pay off their debts

Question 13

Limited liability

Answer 13

Italo’s person to invest in a business without having to face the risk of losing their personal assets if the company goes bankrupt I needs to pay debt

Question 14

Sole Trader

Answer 14

The sole Trader is a popular form of business ownership where a personal service is provided

Question 15

Proprietor

Answer 15

This is a singular person operating a business

Question 16

advantages of a sole Trader

Answer 16

A small business will need less capital

When a profit is made it is divided by one person

You are your own boss and make all your own decisions and involved with every aspect of the business and all your clients

Question 17

Partnerships

Answer 17

A partnership con involved between 2 to 20 people. A bank is not allowed to have more than 10 partners and some professional films

Question 18

Advantages of a partnership

Answer 18

Offer a solution to some of the problems faced by a sole Trader for example multiple in a partnership means more expenses on knowledge, on some me have specialist knowledge such as accountancy

Question 19

Some disadvantages of partnership

Answer 19

The partnership has unlimited liability, but the partnership does not necessarily have to face the depths equally

Question 20

A partnership deed.

Answer 20

A partnership deed sets out the right of each partner regarding the division of the prophets and so on if such a deed does not exist then it is assumed that the profits or debts are shared equally.

Question 21

What is a sleeping partner?

Answer 21

A sleeping partner is a partner that may be willing to introduce Capital into the business but however me not want to take an active part in its operation.

Question 22

Is it possible to have limited partnership?

Answer 22

It is possible but at least one partner must have unlimited liability

Question 23

Advantages of partnership

Answer 23

Easily formed

More people can contribute capital on a sole Trader have you ever

Greater Community than a sole Trader

Expenses and management of the business are shared

Question 24

Disadvantages of partnership

Answer 24

Generally unlimited liability

Possible disagreements between partners

Each partner is liable for the debts of the business

20% membership limit restricts capital resources

Question 25

Cooperatives

Answer 25

This is a special form of business organization they are Incorporated businesses that are owned and controlled by groups with special interest thus having common goals and interests

Question 26

What are the four types of cooperatives?

Answer 26

Consumer cooperatives Marketing cooperatives Workers cooperatives Producers cooperative

Question 27

Consumer cooperatives

Answer 27

Are stores with share the net Prophets of business among members

Question 28

Marketing cooperative

Answer 28

Are businesses which several individuals or small businesses combined sell their goods or services

Question 29

Workers cooperatives

Answer 29

Are businesses that are owned and run by their own Workforce

Question 30

Producers cooperative

Answer 30

Enable members who are involved in producing the same and similar products to cooperatively Market and sell their products

Question 31

Cooperatives shares

Answer 31

The Cooperative sells shares to its members members cannot purchase more than 20% of the overall total

Question 32

Private limited companies

Answer 32

A private limited company has to have a minimum of one member and there is no maximum

Question 33

Can shares for a private limited company be shared publicly?

Answer 33

No, shareholders must be found privately

Question 34

Public limited companies

Answer 34

Hello profit achieved is shared among his contributors and must incorporate the letters PLC in its title it takes a minimum of two people to form a public limited company and there is no maximum

Question 35

Who is elected to participate in day-to-day operations of business in a public limited company

Answer 35

A board of directors is elected to take decisions on their behalf this board elect a chairperson to regulate their meetings

Question 36

Advantages of public companies

Answer 36

Because they can advertise for imports of capital from the public in the form of shares public companies kind of tea in large quantities of capital and resources Their large size enables them to enjoy economies of scale such as The ability to purchase supplies in bulk, thus obtaining the most favorable prices Purchasing the equipment that will save on labor costs Ease of borrowing money and obtaining credit A greater opportunity to undertake research programs which will enhance production and cost-saving operations

Question 37

Disadvantages of public companies

Answer 37

When a public company becomes very large it can become burdened buy too much paperwork It allows the possibility of the firm being taken over by another company that has managed to obtain a controlling number of shares The public company has to send a copy of its account to the register of companies and to each of its shareholders therefore it is difficult for this type of company to keep its Affairs confidential The management of a large company can become inefficient and overstaffed and therefore wasteful of resources

Question 38

Setting up a limited company

Answer 38

If a company wishes to register the business names other than the names of the owner it must register with the Registrar of business names

Question 39

Memorandum of Association

Answer 39

This document States the external relationships of the businesses such as the relationship between the company and others The name of the business and its status, the address of the registered Office of the company, the objective of which the business is formed call Ma the liability of the owners, the amount of capital the company is registered under manner of which it is divided into shares An association close, this is declaration signed by those forming the business confirming they wish to form the company and that they are prepared to teacup and pay for the number of shares shown on the phone by their name the minimum number of signatures is two

Question 40

Articles of Association

Answer 40

The articles of Association outline the internal relationship of the business this is the broad way in which the internal organization will operate it is signed by the same people who signed a memorandum of Association The promoters of the company must also make the following declarations and statements to the Registrar of companies The right of the shareholders The methods and manners of electing directors The manner in which meetings are to be conducted The division of profits weather The remuneration, appointment and removal of auditors The method of audits The issue, transfer on the Forfeit of shares

Question 41

Miscellaneous declaration

Answer 41

Is it was forming a company must also make a number of all the statements and declarations to the Registrar of companies The amount of registered capital and the way it is divided into shares the Declaration made under Oath by the company secretary or a director confirming that all requirements have been met A list of the first directors A statement of consistency by each director confirming they are willing to act in the capacity The registered address of the company

Question 42

Certificate of Incorporation

Answer 42

If the Registrar of companies is satisfied that all the requirements have been met this is issued

Question 43

Franchises

Answer 43

A franchise is a form of business in which a phone that has a successful service or product enters into a contract to other relationship with another business The contract allows the franchise to operate under the franchises name with the franchises guidance in exchange for a fee

Question 44

Advantages of franchises

Answer 44

The reduce the setup risk for entrepreneurs They usually Market in known, successful brand name and image Banks are more likely to allow loans to a new entrepreneur are backed by a known, successful business The franchise jeans an exclusive right to a Market within a specific area The franchisor will have an established supplier relationship so the franchise does not need to create this The franchisor provides considerable backup facilities such as training, marketing, advertising, promotional material and extensive advertising

Question 45

Disadvantages of franchise

Answer 45

If the franchisor has not research the potential Market correctly the franchisee will suffer losses Cost may be higher than expected If franchise agreement includes restrictions and how the business should beer run this can restrict the franchisees freedom to adapt its approach to local market conditions The franchisee must always adhere to the changes in operational technique If the franchise that goes out of business this will have a direct effect on the franchise It can sometimes be more difficult to sell a franchise business than a non franchise one

Question 46

Multi nationalist

Answer 46

This is a business operating internationally although its ownership is usually based in one country

Question 47

Advantages of multinationals

Answer 47

Cheap volleyball may be available in other countries They provide a means of entering a tariff protected Market The factors of production employed more effectively because multinationals raise competition levels They promote advanced technology and training for higher technological skills Increased teamwork and sharing goals are a feature of multinationals A greater variety of product choice benefits consumers in all participating countries Increase employment choices are promoted resulting in higher incomes

Question 48

Disadvantages of multinationals

Answer 48

Like all of Venus is the size of multinationals can be counterproductive The multinational is motivated by self-interest rather than the interests of the host country Multinationals can use their economic power in ways that are socially unacceptable for example exploration of cheap labor and diminishing raw materials and possibly ignoring environmental issues

Question 49

Economic system

Answer 49

Economy is it to him used to define a country in terms of that total composition of its economic activity

Question 50

Command economy

Answer 50

This is a socialist economy in this type of economy all the economic decisions are made by the government the state decide what will be produced how it is to be produced and how it should be allocated to customers

Question 51

Advantages of a command economy

Answer 51

The state ensures that the needs of the whole Community I met and not just the needs of those with the most wealth State Control eliminate wasteful competition The state will provide goods and services that private Enterprises would be unwilling to provide It is not possible for a private Monopoly to develop

Question 52

Disadvantages of command economy

Answer 52

A free market and competition are discouraged Too many non productive government officials are required to administer the system Centralized production may not respond quickly enough to changing conditions and needs Creativity and efficiency are not encouraged

Question 53

Free market economy

Answer 53

In a free-market economy there is little or no government interference in the economy it is based on the private ownership of the factors of production and the means of Distributing goods and services Sometimes this economy is referred to as unplanned or free enterprise or laissez Fair

Question 54

Advantages of a free market economy

Answer 54

Free competition stimulates innovation and it keeps down price Individuals are completely free to use the income and Libra to their best advantage Consumers decide what will be produced by influencing Market forces

Question 55

Disadvantages of free market economy

Answer 55

It encourages inequality of wealth Advertising can be used to create an artificially high demand for your products The more powerful business may by out small ones. Reduce it's competition. Wealthy people are more able to purchase goods and services and influencer Market than the poor Companies may be tempted to restrict supplies to keep prices artificially height

Question 56

Mixed economy

Answer 56

A mixed economy is it combination of elements from a free economy and a controlled economy it is a mixed system the means of production and Supply are shared between the private and public sectors

Question 57

Globalization

Answer 57

This can be seen as the intensification and spread of worldwide social, economic, cultural and political relationships among countries

Question 58

Production

Answer 58

This is a process and methods used by producers to transform inputs such as raw materials semi produce goods and even ideas, information or knowledge into goods and services

Question 59

Marketing

Answer 59

Refers to all processes involved in promoting and selling goods or services in the most profitable and efficient manner

Question 60

What are the four Ps of marketing

Answer 60

Product Promotion place and price

Question 61

Finance

Answer 61

It is possibly the most important resource of all business functional areas

Question 62

What is startup capital?

Answer 62

This is the finances needed to start a business

Question 63

Human resources

Answer 63

Human resources or HR is concerned with managing people within an organization It includes six areas, recruitment, safety, employee relations, compensation and benefits, compliance, training and development,

Question 64

Research and development

Answer 64

This is the investigate activity it business car is out with the aim of getting new knowledge that it can use to create new products or systems

Question 65

Stakeholders of a business

Answer 65

A stakeholder is any person or group of people that has an interest in the business and its activities

Question 66

Different stakeholders

Answer 66

Customers of a business a stakeholders, suppliers to a business a stick holders, employees at businesses are stakeholders The local community all stakeholders Government is also a stakeholder

Question 67

Legal aspects of a business

Answer 67

These are of course many ethical and legal issues that an authentic business will want to consider

Question 68

Money laundering

Answer 68

This is an illegal activity that has become increasingly frequent and today's Global business environment it is a term used to describe the process by which criminals disguise the original ownership of the prophets all of the criminal conduct.

Question 69

National insurance and income tax

Answer 69

One of the legal obligations of a business is to collect money on behalf of the government. For example a business will deduct from the employee's wages for contribution

Question 70

Value added or consumption tax

Answer 70

This falls under the category of Monies collected on the government's behalf, how business. Feels to make the obligatory payment defrauded both the government and their customers.

Question 71

Principles related to forming a business

Answer 71

Are responsible business wouldn't want to establish a code of ethics including policies on environmental issues and protecting personal data related to employees as well as a code of conduct to guide employees in their obligations.

Question 72

Code of ethics

Answer 72

Formulating a code of ethics should be an important aspect of a business establishment especially with large organizations employing many people. The code of ethics is an organization's overall principles that guide its decisions and actions in relation to external or internal issues.

Question 73

Code of conduct

Answer 73

A code of conduct is an internal document that is the practical application of the code of ethics, it is essentially a set of rules and guidelines that describe how people within the organization I expected to behave. All Personnel are given a copy and are required to sign an acknowledgement of it.

Question 74

Code of practice

Answer 74

A code of practice is a set of written rules which explain how people working in a particular profession should behave as they carry out their work, this is intended to reflect good practices and is generally recognized by the whole profession.

Question 75

Consequences of unethical or illegal practices

Answer 75

A Miss deed will be associated with your name of this mess for a very long time, the government May impose taxes aimed at curbing activities for example those causing pollution.

Question 76

Negative effects of unethical and illegal practices

Answer 76

Once a business has acted illegally or unethical e the business loses credibility

Question 77

Consumerism

Answer 77

This term refers to an organized movement to protect the interest of customers by influencing businesses to act in a socially responsible manner.

Question 78

What are some legislative demands that Goods must be?

Answer 78

- To be as described - Fit for purpose which is made known to the seller by customer - Or merchantable

Question 79

Pressure groups

Answer 79

These are groups that seek to persuade the central government, local government, businesses or some of the organization to recognize their views and respond to them

Question 80

The functions of management

Answer 80

They fulfill that same functions planning, organizing, directing, controlling, coordinating, delegating and motivating

Question 81

Planning

Answer 81

This involves mopping out how to achieve particular goals

Question 82

Organizing

Answer 82

After a plant has been established managers need to structure their teams or departments and resources according to the plan

Question 83

Directing

Answer 83

Managers have to ensure that all of the elements within the teams are aware of the targets within the overall plan and deadlines that apply

Question 84

Controlling

Answer 84

Managers have to try to evaluate and measure the work of all of the staff within their team to ensure that everyone is on target to meet the Eames and work identified at the planning stage

Question 85

Controlling

Answer 85

Managers have to try to evaluate and measure the work of all of the staff within their team to ensure that everyone is on target to meet the Eames and work identified at the planning stage

Question 86

Coordinating

Answer 86

An effective manager will ensure that all of the personnel and departments are working together to achieve their overall aims

Question 87

Delegating

Answer 87

Delegating refers to giving a subordinate, a person under the control or direction of another, the authority to oversee a task assigned to them by the manager

Question 88

Motivating

Answer 88

Motivation refers to the reasons for behaving in a particular way in the case of business of course managers wanted their subordinates to give their best effort to achieving the plan.

Question 89

Management responsibilities

Answer 89

Managers whether they are employed by a small business or conglomerates, have responsibilities to the owners and shareholders, employees, Society, customers in government

Question 90

Responsibilities to owners and shareholders

Answer 90

Managers are responsible to owners and shareholders to ensure that the goods or services the business provides a lot of good quality, produce economically and on time underachieving profit

Question 91

Responsibilities to employees

Answer 91

Managers must ensure that workers are provided with adequate and safe working conditions they also must make notice of workers concerns and problems and give them respect.

Question 92

Responsibilities to society

Answer 92

Manages have a two-fold responsibility to society. We have an obligation to ensure the business does not damage the environment as well as having a responsibility to society to try to give back some of the profit

Question 93

Responsibility to customers

Answer 93

The business has an obligation to provide goods or services of decent and safe quality within an agreed. Of time at a fair and economic price

Question 94

Responsibilities to government

Answer 94

Managers fulfill its responsibility to government by ensuring the business is adhering to legislation and behaving in a manner that is compatible with trading practices of both their own country and those of International Community

Question 95

Organizational charts

Answer 95

An organizational chart serves a practical purpose because at a glance it shows the chain of command or the span of control.

Question 96

Chain of command

Answer 96

Most companies are organized in the form of a pyramid the person at the top of the pyramid has the most Authority, and the steps down the pyramid indicate less Authority.

Question 97

Leadership

Answer 97

The term leadership refers to the ability of a person to motivate and influence others to work constructively towards the effectiveness and success of the organization in which they are involved

Question 98

Qualities of a good leader

Answer 98

A good leader tends to be people oriented, with their main aim being to motivate others to achieve goals. Leaders tend to be risk-takers when courage others to participate through consultation and encouragement

Question 99

Characteristics of a good leader

Answer 99

``` Honesty Flexibility Focus Trustworthiness Intelligence ```

Question 100

Leadership styles

Answer 100

Autocratic Democratic Laissez-faire

Question 101

Autocratic leadership

Answer 101

The leader is the absolute Authority on all matters deciding what to do despite what others may think

Question 102

Democratic Leadership

Answer 102

The leader will consult with those likely to be affected or involved before making a decision, although the leader will reserve the right not to act on a majority View

Question 103

Laissez-faire leadership

Answer 103

In this style of leadership the leader gives limited direction to the subordinate workers they are given board objectives and then left to achieve them in the way they think is best

Question 104

The conflict of pay within an organization

Answer 104

This can arise when workers feel that their pay, including benefits, does not compare fairly with people doing the same level of work in other firms, or even where pay is not comparable to colleagues in the same business

Question 105

Conflicts of working conditions in a business

Answer 105

This occurs when workers feel that the condition in the workplace are inadequate, unsafe or unhealthy

Question 106

Conflict in a business with internal changes

Answer 106

Changes in working practices or the implementation of a new technology can become a source of conflict

Question 107

Conflict regarding interpersonal relationships

Answer 107

Disagreements between supervisor and employee or between work colleagues can also result in conflict

Question 108

Communication conflict in business

Answer 108

This may lead to conflict when instructions or tasks or expectations are not clearly expressed

Question 109

The conflict of harassment in business

Answer 109

Sexual, racial, or even just discourtesy. Such conflicts are not only harmful to the organization, but also illegal

Question 110

Conflict strategies by employers

Answer 110

They may lock out workers They can encourage strikebreakers They may attempt to prevent employees from joining or forming a union

Question 111

Conflict strategies by employees

Answer 111

``` Striking or withdrawing their labor Working to rule Organizing slow working Instituting an overtime ban Executing a sidon Using a sick out option ```