-Simple, quick and inexpensive to set up. -The person who owns the business keeps all the profits:id there are any.-The owner has total control and makes all the decisions without the need to consult with others.
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Disadvantages of being a sole trader
-Hard work and stressful.-Wide range of skills needed as as an entrepreneur must manage all the business's functions.-Unlimited liability.-Difficult to raise money to start/expand business.-Sole trader business ends when entrepreneur dies.
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What is an Unlimited liability?
If a sole trader business fails, its owner's personal possessions can be sold to pay business's debts.
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What is a Partnership?
Formed when 2/more people set up in business together.
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What is a Shareholder?
A person/organisation that owns a part of a company.
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What is a Limited Liability?
When a business and it owners are legally separate.
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What are Non-profit Organisations?
May be sole traders, partnerships/companies. Their aims are to help others in society, rather than making a profit (eg; charities)
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Company?
a business that has its own legal identity. It can own items, owe money, sue or be sued.
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Flotation?
When a private limited company (Ltd) becomes a public limited company (Plc) and has its shares listed on the Stock Exchange.
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Stock Exchange?
A market for buying and selling shares of public limited companies.
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Other cards in this set
Card 2
Front
Advantages of being a sole trader
Back
-Simple, quick and inexpensive to set up. -The person who owns the business keeps all the profits:id there are any.-The owner has total control and makes all the decisions without the need to consult with others.
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