Business Studies - Revision Summary for section One

Do charities aim to make a profit?

No, charities are a non profitable organisation.

Describe some of the objectives other than profit that businesses might pursue.

Some businesses will try to be the biggest in their market, others will try to provide the highest quality product possible, some might aim to maximise sales or wealth creation, others might be more concerned with stability, some will focus on ecpanding the business, others will want to satisfy customers, be independent ot try to limit the environmental damage caused.

What is meant by social enterprise?

Some profit-seeking businesses exist to achieve social objectives such as providing help for the homeless, or farmers in poorer countries. They're called social enerprises.

What is meant by a calculated risk?

A calculated risk is where before deciding they'll do research, plan the business carefully to make sure it has a good chance of success and weigh up the consequences of faliure. If the risk is worth taking, the entrepreneaur will go ahead with new business venture.

List five qualities that an entrepreneur is likely to have

The ability to think ahead, initiative, drive and determination, decisiveness, networking skills, leadership skills and powers of persuasion, a willingness to take calculated risks, an ability to plan carefully and an ability to learn from mistakes.

Which two of these are problems if your a sole trader?

a) Long hours  b) Unlimited liability    c) Smelly fish

a) Long hours

and

b) Unlimited liability

What does a sole trader gain and lose if it becomes a partnership?

Each partener is legally responsible for what all the other partners do, some partnerships can have limited liability, more disagreements as your not the only boss, more ideas and more people to share the work and more owners means more capital can be put into the business.

What information might be contained in a deed of partenership?

Partners have an equal say in making decisions and an equal share of the profits unless they have an agreement called a deed of partnership that says different.