1.1.1 Many sole proprietors do business under their own
names because creating a separate trade name is not
1.1.2 Also known as 'proprietorship'
1.1.3 These are unincorporated businesses with one owner
that pays personal income tax on profits from the
1.1.4 This is the simplest business to set
up, making them popular among
individual business owners.
1.2.1 An organisation in which 2 or more individuals
manage and operate a business.
1.2.2 Both owners are equally liable
for debts that the business has
1.3 Public Limited Company
1.3.1 Two or more people are required to
form this type of business.
1.3.2 A company which has offered shares to
the general public and has limited liability.
1.3.3 A PLC's stock can be acquired by anyone and holders are
only limited to potentially lose the amount paid for shares.
1.4 Private Limited Company
1.4.1 This type of business does not need to meet strict securities and
exchange commission filing requirements of public companies.
1.4.2 A company whose ownership is private.
1.5 Public Corporations
1.5.1 A company whose shares are publicly traded and
are usually held by a large number of shareholders.
1.5.2 A government owned company such as an
airline or public transit company.
1.6.1 This type of business allows for easy transfer.
1.6.2 Achieves lower tax rate.
1.6.3 The process of legally declaring a
corporate entity as separate from
1.6.4 Protects owner's assets.
2 The three sectors
2.1 Primary sector
2.1.1 this involves acquiring raw materials. For example, metals and
coal have to be mined, oil drilled from the ground, rubber
tapped from trees, food farmed and fish trawled.
2.1.2 Also known as 'extractive'.
2.2 Secondary sector
2.2.1 this is the manufacturing and assembly process. It involves converting raw
materials into components, for example, making plastics from oil. It also
involves assembling the product, e.g. building houses, bridges and roads.
2.2.2 Also known as 'manufacturing'.
2.3 Tertiary sector
2.3.1 this refers to the commercial services that support the production and
distribution process, e.g. insurance, transport, advertising, warehousing
and other services such as teaching and health care.
2.3.2 Also known as 'services'.
2.4 The chain of production shows interdependence: firms rely on
other businesses in different sectors for raw materials,
components or distribution.
3.1 Recruitment is the process that businesses go
through to gain staff.
3.2 An important way to advertise a vacancy is to
include a job description, as well as job
3.3 Retention is how a business is able to retain its staff/employees.
3.4 The process: The business realises that it needs more staff. They then announce that they are recruiting
and advertise a job description and specification. They go through multiple CVs and job applications. Then
the interview process begins, and successful applicants will be hired.
3.5 CV: This is a profile/personality of the applicant.
3.6 Application form: This is written by the applicant explaining why they
believe they are suitable for the job.
3.7 Interviews: The interviewer will meet the candidate for
4.1 People are able to purchase shares of a business on the stock market.
4.2 Shares can be used as a means of raising finance and making money.
4.3 A minority shareholder is someone that owns a very small part of a business.
4.4 A major shareholder is someone that owns a
substantial part of a company e.g. the CEO.
4.5 Shares can fluctuate depending on how much money the business
is making, if there is a takeover bid, or if a company's future looks