Development of Barter
Barter is...
the exchange of goods and services without the use of money
Simplest economic system
Subsistence/ Traditional Economy
Owner, Employee, Shareholder
Sole Proprietor or Entrepreneur
How many persons can be in a Partnership
Two (2) - Twenty(20)
The system that replaced Barter
Money
The State is in full control in this economic system
Planned/ Command/ Socialist Economy
Two External Stakeholders are
Government, Consumers, Community members
Name two characteristics of a sole trader
Characteristics
1. Easy to set up
2. Financed by the owner through personal savings or loans
3. Bears all risks and keeps all profits
4. Provides a personal service
5. Has no one to account to but themselves
All profits are shared equally.
Three instrument of exchange
Debit Card, Eft, Credit cards, Standing Order, Ecommerce, Money Orders, Bank Drafts, Tele banking
Both Private and Public Sector
Mixed Economy
Durable, Acceptable, Exchangeable, Divisiable, Scarce, Portable, Homogenous
Three advantages of a sole trader
Advantages
1. Easily and quickly formed and dissolved
2. Close relationship with customers
3. Decisions can be made quicker
4. Takes all profits
5. Pays lower personal tax not company tax
Name three disadvantages of Partnership
1. Unlimited liability
2. Personalities of partners may cause difficulties in decision making.
3. Some difficulty in raising capital.
4. In the absence of an agreement all profits must be shared equally
Incharge of the Public Sector
Government
This department hires, fires and train employees
Human Resource Department
Identify the four functions of money
Medium of Exchange, Measure of value, Store of Value, Standard for deferred payment
Three disadvantages of a sole trader
Disadvantages
1. Limited capital and it is not easy to get loans
3. Long working hours
4. Business usually dissolves if owner dies
4. Lack of specialized staff
Name four advantages of Partnership
Advantages
1. Relatively easy to set up
2. More capital can be obtained than sole trader
3. Business will not end if one partner dies (continuity)
4. Specialization can occur thus leading to greater efficiency
5. Shared work load
5. Pays lower personal tax not company tax
1 man business
Sole Trader/ Sole Proprietorship
This Department advertises the products for the business
Marketing Department
Name five choice of payment that are easy to use that a business own would utilize in his business
Direct debit, Credit Transfer, Credit Card, Bank Draft, Cash and Cheques, Standing Order, Documentary Credit,
What is Privatization?
Privatization occurs when a government-owned business, operation, or property becomes owned by a private, nongovernment party.
Name five things that should be in a partnership agreement
indicates the number of partners, amount of capital from each partner, how profits are to be divided, name of partnership, salary to be paid, how partnership is to be dissolved, role of each partner