The role of a business
Identify one reason why business studies is important
Successful business owner, informed consumer, Knowledgeable employee, educated investor
Recall the main activity of a business
Sells products to satisfy consumer needs and wants
Name one of the quantitative measures that can be used to determine the size of a business?
Number of employees
Number of owners
Market share
Amount of revenue earned
Amount of assets owned
Do government enterprise participate in commercial activities with the goal of making a profit?
Yes
If the owner of a company passes away, does the company need to close down?
No, the business is legally separate from its owners (shareholders) and can survive changes in ownership
What is the one thing that all people have in common?
Needs and wants
How much profit does Sally make in a four week period if her income is $6000 per week and her operating expenses are $3500 per week?
$10,000
How many employees does a micro business employ?
Less than five
What type of business operates in multiple states but in only one country?
Geographical, local, national, or global
National
What is the maximum number of shareholders a private company can have?
50
What is the core activity of salesforce?
Provider of cloud based software
What are the three ways in which businesses provide income?
Wages
Salaries
Dividends
What industry sector does agriculture fit into?
Primary
Which industry sector is described as 'services that have been traditionally performed in the home'?
Quinary
Which industry sector includes retail, entertainment and health care?
Tertiary
Explain how employment keeps the economy healthy
To be able to purchase goods consumers need money. They work to earn money to buy products to satisfy their needs and wants - hence, supporting the business and opening up opportunities for more employment through business growth
Describe the two main risks associated with operating a business
Not being paid and losing money they have put into the business
Are private companies unincorporated or incorporated?
Incorporated
Once a company floats and sells shares to the public, if the original owner/s wished to retain control of the business, what do they need to do?
Hold more than 50% of all the shares sold
If a product is 'objectively valued', what does this mean?
It means that its cost can be determined by an independent assessment of the costs of materials, labour and processing costs used to produce the product
Name three ways in which the wealth created by a business is redistributed
Salaries, wages and other employee benefits
Lenders - loan repayments
Owners - profits and dividends
Government - taxes
Business - depreciation and retained profits
What is the connection between innovation and productivity?
As innovation increases, productivity increases
Name two of the most important factors that influence the decision of the most appropriate legal structure for a business?
Size
Ownership
Finance
Define equity
Internal funding rising from capital contributions and any net profits generated by the business through its operations
Explain the concept of 'stewardship' for business managers
Managers need, and should, act in the best interests of the company, not their personal best interests