SAC 1 business chapter 1

Question 1

business

Answer 1

any activity conducted by an individual or individuals to produce and sell goods and services that satisfy the needs of society, as well as making profit

Question 2

sole trader

Answer 2

a business owned and operated by one person

Question 3

partnership

Answer 3

a business owned by two or more people (generally a maximum of 20)

Question 4

private limited company

Answer 4

an incorporated business that has a minimum of one shareholder and a maximum of 50 non-employee shareholders, and whose shares are offered only to those people whom the business wishes to have as part owners

Question 5

public listed companies

Answer 5

an incorporated business with a minimum of one shareholder (and no maximum), and whose shares are openly traded on the Australian Securities Exchange

Question 6

social enterprises

Answer 6

a business with the objective of fulfilling a social need

Question 7

government business enterprises

Answer 7

a type of business that is government owned and operated

Question 8

business objectives

Answer 8

1: to make a profit
2: to increase market share
3: to improve efficiency
4: to improve effectiveness
5: to fulfil a market need
6: to fulfill a social need
7: to meet shareholder expectations

Question 9

profit

Answer 9

what is left after business expenses have been deducted from money earned from sales (revenue)

Question 10

market share

Answer 10

the proportion of total sales in a given market or industry that is controlled or held by a business, calculated for a specific period of time

Question 11

efficiency

Answer 11

how well a business uses resources to achieve objectives

Question 12

effectiveness

Answer 12

the degree to which a business has achieved its stated objectives

Question 13

shareholders

Answer 13

(or members) the owners of a company

Question 14

stakeholder

Answer 14

groups and individuals who interact with the business and have a vested interest in its activities

Question 15

stakeholders of a business (examples)

Answer 15

-owners
-managers
-employees
-customers
-suppliers
-the general community

Question 16

management style

Answer 16

the behavior and attitude of the manager when making decisions, when directing and motivating staff, and when implementing plans to achieve business objectives

Question 17

management styles- autocratic

Answer 17

one where the manager tells staff what decisions have been made

Question 18

management styles- persuasive

Answer 18

one where the manager attempts to ‘sell’ decisions made

Question 19

management styles- consultative

Answer 19

one where the manager consults employees before making decisions

Question 20

management styles- participative

Answer 20

one where the manager unites with staff to make decisions together

Question 21

management styles- laissez-faire

Answer 21

one where the employees assume total responsibility for, and control of, workplace operations

Question 22

management styles- autocratic (advantage & disadvantage)

Answer 22

advantage: directions and procedures are clearly defined; there is little uncertainty
disadvantage: no employee input is allowed

Question 23

management styles- persuasive (advantage & disadvantage)

Answer 23

advantage: Managers can gain some trust and support through persuasion

disadvantage: communication is still poor and limited to a top-to-bottom, one-way system

Question 24

management styles- consultative (advantage & disadvantage)

Answer 24

advantage: asking for suggestions from employees allows for a greater variety of ideas

disadvantage: time take to consult all relevant employees

Question 25

management styles- participative (advantage & disadvantage)

Answer 25

advantage: employees have a greater opportunity to acquire more skills disadvantage: internal conflict can arise with so many views and opinions

Question 26

management styles- laissez-faire (advantage & disadvantage)

Answer 26

advantage: employees feel a sense of ownership, which can promote outstanding results disadvantage: complete loss of control by management. potential for misuse of the business's resources (time & money)

Question 27

the appropriateness of management styles (the considerations)

Answer 27

-nature of the task -time -experience of employees -manager preference

Question 28

manager preference

Answer 28

a managers personality, values, beliefs and skills influence the management style they choose

Question 29

experience of employees

Answer 29

inexperienced staff- autocratic experienced staff- participative (NOT ALWAYS)

Question 30

Nature of task

Answer 30

depends of complexity of task whether different situations need a range of ideas or not

Question 31

time

Answer 31

depends if there is a tight deadline or extended time frame

Question 32

management skills

Answer 32

the abilities or competencies that managers use to achieve business objectives

Question 33

management skills- communication

Answer 33

the ability to transfer information from a sender to a receiver, and to listen to feedback

Question 34

management skills- delegation

Answer 34

the ability to transfer authority and responsibility from a manager to an employee to carry out specific activities

Question 35

management skills- planning

Answer 35

the ability to define business objectives and decide on the methods or strategies to achieve them

Question 36

management skills- leadership

Answer 36

the ability to influence or motivate people to work towards the achievement of business objectives

Question 37

management skills- decision-making

Answer 37

the ability to identify the options available and then choose a specific course of action from the alternatives

Question 38

management skills- interpersonal

Answer 38

the ability to deal or liaise with people and build positive relationships with staff

Question 39

corporate culture

Answer 39

the values, ideas, expectations and beliefs shared by members of the business

Question 40

contingency management theory

Answer 40

stresses the need for flexibility and the adaptation of management styles to suit the situation

Question 41

official corporate culture

Answer 41

Corporate culture can be revealed officially in the policies, objectives or slogans of a business.

Question 42

real corporate culture

Answer 42

Corporate culture can also be seen in the unwritten or informal rules that guide how people in the business behave, such as the way staff dress, the language staff use, and the way that staff treat each other and customers.