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National 5 Business > Understanding business > Flashcards

Understanding business Flashcards

1
Q

what are the disadvantages of a partnership?

A
  • The profit that is made is shared.
  • Partners may not always agree.
  • You have unlimited liability.
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2
Q

what are the economical factors?

A
  • Exchange rates.
  • Disposable income.
  • Level of employment.
  • Interest rates.
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3
Q

What are the social factors?

A
  • More women in work.
  • More people buying their own homes.
  • People against animal testing on cosmetics.
  • Increased car ownership.
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4
Q

What is limited liability?

A
  • When the owners personal possessions are not at risk.

- They only lose what they put into the business (For example 50k).

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5
Q

Who are the external stakeholders?

A
  • Local communities.
  • Local governments.
  • National government.
  • Customers.
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6
Q

What is unlimited liability?

A
  • The opposite of limited liability.

- The owners personal belongings can be taken off of them if they are unable to pay of debt.

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7
Q

What are the sectors of economy?

A
  • Public.
  • Private.
  • Third.
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8
Q

What are the sectors of industry?

A
  • Primary.
  • secondary.
  • Tertiary.
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9
Q

Who are the internal stakeholders?

A
  • Owners.
  • Employees.
  • Shareholders.
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10
Q

Who owns, controls and finances the private sector?

A
  • Owned by private individuals.
  • Controlled by private individuals.
  • Financed by retained profits.
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11
Q

What are the competition factors?

A
  • Location.
  • Growth/size.
  • Price wars.
  • Product/service being offered.
  • Intimidation.
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12
Q

What are the consequences of poor customer service?

A
  • Decrease in profits.
  • Bad reputation.
  • Loss of market share.
  • Loss of competitive edge.
  • Low staff morale.
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13
Q

What are the environmental factors?

A
  • Storms.
  • Recycling.
  • Floods.
  • Climate change.
  • Pollution.
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14
Q

What are the political factors?

A
  • Smoking ban in public places.
  • Health and safety regulations.
  • Increase in petrol prices.
  • Taxes.
  • Advertising and promotion of alcohol.
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15
Q

What is the aim of the private sector?

A

To make a profit.

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16
Q

What is the aim of the third sector?

A

To provide services to a worthy cause.

17
Q

What are the disadvantages of being a sole trader?

A
  • You have unlimited liability.
  • You have to work long hours with little holidays.
  • It can be difficult to finance.
18
Q

What are the external factors?

A
  • Political.
  • Economical.
  • Social.
  • Technological.
  • Environmental.
  • Competition.
19
Q

What are the benefits of good customer service?

A
  • Customer loyalty.
  • Improved reputation.
  • Employee satisfaction.
20
Q

What are the factors of production (CELL)

A
  • Capital.
  • Enterprise.
  • Labour.
  • Land.
21
Q

Why do businesses exist?

A
  • To provide goods and services.
  • To provide employment.
  • To provide choice.
  • To innovate.
  • To create competition.
  • To develop infrastructure.
  • To supply worthy causes.
  • To increase and individuals wealth.
22
Q

What are the business objectives?

A
  • Survival.
  • Profit.
  • Provision of a service.
  • Customer satisfaction.
  • Enterprise.
  • Social responsibility.
  • Marketshare.
23
Q

Why do businesses exist?

A
  • To provide goods and services.
  • to provide employment.
  • to provide choice.
  • to innovate.
  • to create competition.
  • to develop infrastructure.
  • to supply worth causes.
  • to increase an individual wealth.
24
Q

What are the factors of production (cell)?

A

capital
enterprise
labour
land

25
Q

what are the benefits of good customer service?

A

customer loyalty
improved reputation
employee satisfaction

26
Q

What are the external factors?

A 
political
economical
social
technological
enviromental
competition
27
Q

what are the benefits of being a franchise

A

the franchise is a well known business with an existing customer base
industry knowledge and training is provided
franchises benefit from national ads

28
Q

Wha are the advantages of a partnership?

A

the workload is shared

it will be easier to raise capital to finance the business

29
Q

what are the benefits of being a sole trader?

A

you get to make your own decisions
it’s easier to set up
you get to keep 100% of the products and profits

30
Q

What are the disadvantages of a public limited company

A

Can lose control of the business

profits are shared amongst the shareholders

31
Q

what is a stakeholder

A

a person or group of people who have an interest in the success of the business

32
Q

name the aim and samples of the public sector

A

the aim is to provide services either locally or nationally

examples are schools, the NHS and BBC

33
Q

what are the technological factors

A

growth of the internet
computer controlled machines
e-commerce
firms must keep up with new technology

34
Q

what are the disadvantages of a private limited company

A

the profits must be shared among shareholders (dividends)
there is a restricted number of shareholders
you must produce annual accounts which competitors can access

35
Q

what are the advantages of a private limited company

A

experience and skill will be gained from having multiple shareholders
control of he business is not lost to outsiders as it is invite only

36
Q

what are the internal factors

A

financial
Human Resources
current technology

37
Q

what are the disadvantages of being a franchise

A

this is a high initial fee
you have little autonomy over decisions
royalties must be paid each year

38
Q

what is a franchise

A

a business model that allows businesses to pay a sum of money to own a brand of a well known existing business

39
Q

what are the benefits of a public limited company

A

huge amounts of finance can be raised (on the Stockmarket)

experience can be gained

National 5 Business (5 decks)

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