economics business

• What is the definition of a business?


  A business is an organization engaged in commercial, industrial, or professional activities to provide goods or services in exchange for money.
• What is the main purpose of a business?

  The main purpose of a business is to make a profit by providing goods or services.
• What are the types of businesses based on profit orientation?

  - For-profit businesses - Non-profit businesses
• What is the range of business sizes?

  Businesses can range from small, one-person operations to large, multinational corporations.
• How do businesses contribute to the economy?

  Businesses create jobs and generate wealth, playing a crucial role in the economy.
• What is a sole trader?


  A sole trader is a business owned and run by one person who is self-employed.
• What is the legal status of a sole trader in relation to their business?

  A sole trader has no separate legal existence from their business.
• What does unlimited liability mean for a sole trader?


  Unlimited liability means the sole trader is personally responsible for all business debts.
• What happens to the profits of a sole trader?

  All profits go to the sole trader, but they also bear all the risks.
• Can you give examples of sole traders?


  Examples of sole traders include local shopkeepers, plumbers, and freelance writers.
• What is a partnership?


  A partnership is a business owned by two or more individuals who share management and profits.
• How do partners share responsibility in a partnership?

  Partners share responsibility and liability for the business according to their partnership agreement.
• What is one advantage of partnerships over sole traders?

  Partnerships have more capital available than sole traders.
• Can you give examples of partnerships?

  Examples of partnerships include law firms, dental practices, and small accounting firms.
• What does limited liability mean for owners of a private limited company?

  Limited liability means the owners' personal assets are protected from the company's debts.
• What is a private limited company (Ltd.)?


  A private limited company is a common form of business ownership where the company has a separate legal identity from its owners.
• What is required for a private limited company in terms of management?

  A private limited company must have at least one director and one shareholder.
• What is a restriction on the shares of a private limited company?

  Shares of a private limited company cannot be sold to the general public.
• Can you give examples of private limited companies?


  Examples of private limited companies include many small and medium-sized businesses.
• What is a public limited company (PLC)?


  A public limited company is a larger business that can sell shares to the general public on the stock market.
• What does it mean for shares to be freely transferable in a PLC?

  Freely transferable means shares can be bought and sold by anyone without restrictions.
• What is the minimum share capital required for a public limited company?

  The minimum share capital required for a public limited company is £50,000.
• What are the regulatory requirements for public limited companies?

  Public limited companies are subject to stricter regulations and reporting requirements than private limited companies.
• Can you give examples of public limited companies?


  Examples of public limited companies include large corporations like Tesco, BP, or Vodafone.
• Which types of business structures have unlimited liability?

  Sole traders and partnerships have unlimited liability.
• What does unlimited liability mean for business owners?

  Unlimited liability means the owner is personally responsible for all business debts, risking their personal assets if the business fails.
• What is the difference between limited and unlimited liability?

  Limited liability protects personal assets from business debts, while unlimited liability means personal assets can be used to pay business debts.
• What are the two business structures that have unlimited liability?

  Sole trader and partnership
• What is the difference between limited liability and unlimited liability?

  Limited liability protects personal assets, while unlimited liability means personal responsibility for all business debts.
• What does 'unlimited liability' mean for a business owner?

  Unlimited liability means the owner is personally responsible for all business debts, potentially risking their personal assets if the business fails.
• If John runs a plumbing business as a sole trader and accumulates £50,000 in debt, what could happen due to unlimited liability?

  John might have to sell his personal assets to pay the debt.
• What are the key characteristics of sole traders, partnerships, private limited companies, and public limited companies?

  - Sole Traders: - Easiest to set up - Full control - Unlimited liability - Partnerships: - Shared responsibility - More capital than sole traders - Unlimited liability - Private Limited Companies (Ltd): - Limited liability - Separate legal identity - Cannot sell shares publicly - Public Limited Companies (PLC): - Can sell shares publicly - Limited liability - More regulations
• What business structure would be most suitable for Sarah, who wants full control and a simple setup but is worried about personal asset risks?

  Private Limited Company
• What business structure should Tom and Lisa choose if they want to share responsibilities and profits but are concerned about personal liability?

  Private Limited Company
• Which statement about business structures is true?

  Private limited companies have limited liability but cannot sell shares to the general public.
• What is a key difference between a private limited company (Ltd) and a public limited company (PLC)?


  A PLC can sell shares to the general public, while a Ltd company cannot.