PRELIMINARY

• What is the role of business in society?

  To increase individual wealth and contribute to economic growth.
• How does business impact quality of life?

  Businesses improve quality of life through employment and income.
• What are the classifications of business based on size?

  • Small: Less than 20 employees, independently owned.
  • Medium: 20-199 employees, owned/operated by a few people.
  • Large: 200+ employees, owned by thousands of public shareholders.
  • SMEs: Fewer than 200 employees, annual turnover less than $10 million.
• What are the geographical classifications of business?

  • Local: Operates within one community.
  • National: Operates in one country with multiple locations.
  • Global: Operates in many countries (transnational corporations).
• What are the industry classifications of business?

  • Primary: Collection of natural/raw resources (e.g., farming).
  • Secondary: Producing finished/semi-finished products (e.g., manufacturing).
  • Tertiary: Providing services (e.g., banking).
  • Quaternary: Processing information/knowledge (e.g., telecommunications).
  • Quinary: Domestic services (e.g., hospitality).
• What are the legal structures of business?

  • Incorporated: Separate legal entity from owners.
  • Unincorporated: No separate legal entity from owners.
• What is a sole trader?


  A business owned and operated by one person.
• What is the liability of a sole trader?

  Unlimited liability, meaning the owner is responsible for all financial/legal difficulties.
• What are the advantages of a sole trader?

  Complete control, low entry cost, owner keeps all profit.
• What are the disadvantages of a sole trader?

  Unlimited liability, difficulty in raising finance, burden of management.
• What is a partnership?

  A business owned and operated by between 2 and 20 people.
• What are the advantages of a partnership?

  Low start-up costs, shared workload, pooled funds.
• What are the disadvantages of a partnership?

  Unlimited liability, possibility of disputes, divided authority.
• What is a private company?

  A company structure with 2-50 shareholders that is not listed on the stock exchange.
• What are the advantages of a private company?

  Limited liability, easier to attract public finance, experienced management.
• What are the disadvantages of a private company?

  Double taxation, must publish yearly annual report, public disclosure.
• What is a public company?

  A company with at least one shareholder, listed on the Australian Stock Exchange.
• What are the main sources of finance for businesses?

  • Debt finance: Borrowed from banks/investors.
  • Equity finance: Internal funds from owners.
• How do interest rates affect business finance?

  An increase in interest rates leads to lower dependence on debt finance.
• What are the external influences on business?

  • Geographic: Climate, natural resources, location.
  • Demographic: Age distribution, population size, income.
  • Social: Societal attitudes, environmental awareness, workplace diversity.
  • Legal: Compliance with laws and regulations.
  • Political: Government policies affecting business.
  • Institutional: Impact of government levels and regulatory bodies.
  • Technological: Use of tools and systems to improve operations.
• What is the Competition and Consumer Act 2010 (Cth)?


  A law that governs business conduct and competition in Australia.
• What is the impact of globalization on business?

  Globalization allows business activity overseas.
• What are the competitive situations in the market?

  • Monopoly: Complete concentration by one business.
  • Oligopoly: Small number of large businesses dominate the market.
• What is a monopoly?


  A market situation where one business has complete concentration.
• What is an oligopoly?


  A market dominated by a small number of large businesses.
• How does competition affect businesses?

  Increased competition can lead to innovation and better services.
• How do internal influences affect business operations?

  Internal influences include management decisions, company culture, and resources.
• What are the factors contributing to business decline?

  Factors include poor management, lack of market demand, and financial mismanagement.
• What is the significance of a business plan?

  A business plan outlines the strategy and direction for a business's future.
• What is the role of stakeholders in a business?

  Stakeholders influence business decisions and outcomes.
• How can businesses respond to challenges at each stage of the business life cycle?

  By adapting strategies to meet changing market conditions and consumer needs.
• What is voluntary cessation in business?

  When a business owner decides to close the business willingly.
• What is involuntary cessation in business?


  When a business is forced to close due to legal or financial issues.
• What is liquidation?


  The process of closing a business and selling its assets to pay creditors.
• What are the stages of the business life cycle?

  The stages include startup, growth, maturity, and decline.
• How does effective management contribute to business success?

  Effective management leads to better decision-making and resource allocation.
• What is the importance of monitoring and evaluation in business?

  Monitoring and evaluation help assess performance and guide improvements.
• What is the role of technology in business?

  Technology improves productivity and communication within businesses.
• How can businesses sustain competitive advantage?

  By continuously innovating and adapting to market changes.
• What are the critical issues in business success and failure?

  Issues include financial management, market demand, and effective leadership.