Unit 1 BM

Question 1

sole trader

Answer 1

is a business structure that is owned and operated by one individual
adv: full control over decisions, easy to register and set up
Dis: unlimited liability, less free time

Question 2

partnership

Answer 2

a business that is owned by 2 or 20 owners
adv: 1)greater range of expertise
2) owners can share the workload
dis: 1) unlimited liability
2)Conflicts could arise due to shared decision-making

Question 3

private limited company

Answer 3

is an incorporated business structure that has at least one director and a maximum of 50 shareholders.
adv: There is limited liability for shareholders.
dis: It is expensive to set up and operate

Question 4

public listed company

Answer 4

is an incorporated business that has an
unlimited number of shareholders and lists and
sells its shares on the ASX
adv: Shareholders have limited liability
dis:Conflicts could arise

Question 5

dividends

Answer 5

 are regular sums of money paid out
to shareholders from a company’s profit

Question 6

Shareholders 

Answer 6

are the individuals or organisations who have purchased shares of a company and therefore are part-owners of the company

Question 7

Limited liability

Answer 7

is when shareholders are only liable to the extent of
their original investment, meaning they are not personally responsible for the business debts.

Question 8

social enterprise

Answer 8

a social enterprise is a business that aims to fulfil a community or environmental need by selling goods and services.
Adv: 1) the community benefits
2)business can develop positive reputation
Dis: 1) difficult to balance finances and social objectives
2)may be difficult to obtain a bank loan

Question 9

government enterprise

Answer 9

a business that is owned by the government. it is operated in the public sector and fulfils all large scale needs such as housing, transport
Adv: 1) helps the community
2) can operate with some independence
Dis: 1) government and politicians can interfere
2) GBE’s have to follow significant “red tape”

Question 10

business objectives

Answer 10

are the goals a business intends to achieve.
types of business objectives:
1) to make a profit
2) to increase market share
3) to meet shareholder expectations
4) to fulfil a market need
5) to fulfil a social need
6) to improve efficiency
7) to improve effectiveness

Question 11

when a business makes a profit

Answer 11

profit occurs when businesses create more revenues than expenses

Question 12

to increase market share

Answer 12

when a business increases it’s number of sales it can consequently increase its percentage of market share.by producing products with new technology, increasing customer loyalty

Question 13

to meet shareholder expectations

Answer 13

shareholders invest their own money into a business by purchasing companies shares. their investment can facilitate the growth and development

Question 14

capital gain

Answer 14

is an increase of the value of a share, meaning an investor can sell their shares at a higher price than what they originally purchased them for

Question 15

fulfil a market need

Answer 15

to fill the gaps in the market to address customer needs. This is done by identifying target market

Question 16

fulfill a social need

Answer 16

improving society and the environment through business activities

Question 17

improve efficiency

Answer 17

how productively a business uses its resources when producing a good or service. to improve efficiency, the business has to improve their productivity

Question 18

improve effectiveness

Answer 18

is the extent to which a business achieves its stated objectives. business objectives can be improved by their performance to meet set targets.

Question 19

stakeholders

Answer 19

are the individuals, groups, pr organisation who have a vested interest in the performance and activities. stakeholders are:
1)owners and shareholders
2) managers and employees
3) suppliers and customers
4) general community

Question 20

owners

Answer 20

 are individuals who establish, invest, and have a share in a business, often with the goal of earning a profit from its operations. In public listed and private limited companies, owners are known as shareholders.

Question 21

internal stakeholders

Answer 21

are individuals, groups, or organisations who are
employed by or have a financial share in
the business.

Question 22

external stakeholders

Answer 22

are individuals, groups, or organisations who
are outside the business and are impacted by or interested in a business’s activities

Question 23

managers

Answer 23

are individuals who oversee and coordinate a businesses employees and lead its operations to achieve business objectives

Question 24

Employees

Answer 24

Employees are individuals who are hired by a business to complete work tasks and support the achievement of its objectives.

Question 25

Customers

Answer 25

are individuals or groups who interact with a business by purchasing and utilising its goods and services.

Question 26

Suppliers

Answer 26

are individuals or groups that source new raw materials and sell them to a business for use in the production of its goods and services.

Question 27

stakeholder interest

Answer 27

When a business fulfils stakeholder interests, it strengthens the relationship it has with these stakeholders, positively impacting business reputation and performance.

Question 28

stakeholder conflicts

Answer 28

often the priorities and expectations of one group will conflict and disagree with those of another.E.g. Owners – want to increase profits by decreasing the salary of managers. vs Managers – want to receive greater rewards and salaries from the business as recognition for the achievement of objectives.

Question 29

manager styles

Answer 29

is the approach and manner in which employees are directed and motivated within a business manager styles can be characterised through 1) decision making 2) communication flow 3) control

Question 30

Autocratic management style

Answer 30

involves a manager making decisions and directing employees without any input from them features: - centralised control - one way communication - purely expected to follow managers directions

Question 31

persuasive management style

Answer 31

involves a manager making decisions and communicating the reasons for those decisions to employees without their input features: - manager communicates the reason - one way communication - employees feel considered

Question 32

consultative management style

Answer 32

invovles a manager seeking input from employees on business decisions but making the final decision themselves features: - two way communication - manager affectively considers employee feeback - employees feel valued - centralised control

Question 33

Participative management control

Answer 33

involves a manager sharing information with employees so that employees can participate in decision- making features: - two way communication - decentralised control

Question 34

Laissez-fair management style

Answer 34

Involves a manager communicating business objectives to employees and giving them freedom to make decisions independently features: - two- way communication - employees are given freedom to achieve business objectives - decentralised control - allows employees to take ownership

Question 35

Appropriateness of management styles

Answer 35

1) times 2) experience of employee 3) nature of the task 4) manager preference

Question 36

management styles

Question 37

planning

Answer 37

is the process of determining a business objectives and establishing strategies to achieve these aims: - strategic planning - tactical planning - operational planning

Question 38

SWOT analysis

Answer 38

can be used to evaluate different aspects of the business environment in planning process - strengths - weaknesses - opportunities - threats

Question 39

decision making

Answer 39

is the skill of selecting a suitable course of action from a range of plausible options

Question 40

communication

Answer 40

is the skill of effectively transferring information from one party to another 1) verbal 2) non verbal

Question 41

delegation

Answer 41

is the skill of assigning work tasks and authority to other employees who are further down in a business hierarchal structure

Question 42

interpersonal

Answer 42

is the skill of creating positive interactions with other employees to foster beneficial professinal relationship

Question 43

leadership

Answer 43

is the skill of motivating others in order to achieve a business objective

Question 44

corporate culture

Answer 44

is the shared values and beliefs of a business and it's employees positive corporate culture negative corporate culture

Question 45

official culture

Answer 45

involves the shared views and values that a business aims to achieve, often outlined in a written format. such as: - mission statements - vision statements examples of corporate documentation: - share objectives - policies - training - symbols - uniform

Question 46

Real corporate culture

Answer 46

involves the shared values and beliefs, that develop organically within a business and are practised on daily basis by employees 1) types of employees 2) workplace environment