1.1 The purpose and nature of businesses

    Cards (32)

    • What is the primary purpose of a business in terms of profit?
      Make money to grow
    • What does the profit motive of a business allow it to do?
      Grow and reinvest
    • A sole proprietorship is owned and managed by one person
    • What is a key disadvantage of a sole proprietorship?
      Unlimited liability
    • Internal stakeholders include employees, managers, and owners
    • Production is the process of converting raw materials into finished goods or services.

      True
    • What is the primary reason for the existence of a business called?
      Purpose
    • Match the business purpose with its key benefit:
      Profit Motive ↔️ Sustained growth and reinvestment
      Value Creation ↔️ Increased customer satisfaction
      Social Responsibility ↔️ Enhanced reputation and trust
    • A Public Limited Company (PLC) sells its shares publicly.

      True
    • The nature of business activity involves creating goods and services to satisfy customer needs.

      True
    • What is the primary goal of a commercial enterprise?
      Maximize profit
    • Social responsibility can enhance a business's ethical brand image
    • What are the four primary types of business organizations?
      Sole proprietorship, partnership, private limited company, public limited company
    • Shares in a private limited company can be sold publicly.
      False
    • What are stakeholders in a business?
      Individuals or groups with interest
    • What are the two key activities in the nature of business activity?
      Production and exchange
    • What is the role of social responsibility in a business?
      Ensure operations benefit society
    • Value creation involves providing products or services that meet customer needs.
      True
    • What type of business organization has unlimited liability?
      Sole Proprietorship
    • Match the stakeholder type with their examples:
      Internal Stakeholders ↔️ Employees, managers, owners
      External Stakeholders ↔️ Customers, suppliers, government
    • The marketing function focuses on understanding customer needs
    • Value creation involves providing products or services that customers need.

      True
    • Businesses aim to satisfy customer needs to generate sales and revenue.

      True
    • Match the type of business organization with its key feature:
      Sole Proprietorship ↔️ Easy to start, full control
      Partnership ↔️ More capital, shared management
      Private Limited Company ↔️ Limited liability, easier to raise capital
      Public Limited Company ↔️ Large capital base, better reputation
    • Order the types of business organizations from least to most complex in terms of setup:
      1️⃣ Sole Proprietorship
      2️⃣ Partnership
      3️⃣ Private Limited Company
      4️⃣ Public Limited Company
    • Match the stakeholder type with their key interest:
      Employees ↔️ Job security and wages
      Customers ↔️ Product quality and value
      Government ↔️ Tax revenue and compliance
    • The profit motive allows a business to sustain growth
    • The profit motive of a business aims to generate income
    • Order the types of business organizations from simplest to most complex:
      1️⃣ Sole Proprietorship
      2️⃣ Partnership
      3️⃣ Private Limited Company (Ltd)
      4️⃣ Public Limited Company (PLC)
    • Stakeholders are individuals or groups with an interest in a business's activities
    • What are the two essential elements of business activity?
      Production and exchange
    • Match the type of enterprise with its feature:
      Commercial Enterprise ↔️ Maximizes profit
      Social Enterprise ↔️ Achieves social mission