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business

what is a buisness activity

a business which carries out activities such as producing goods or services to gain profit

entrepreneur

a calculated risk-taker who sets up a business for financial gain

characteristics of entrepreneur

creativity risk taking and persuasive

invention?

creating something which hasnt previously existed

innovation

when you adapt a product over time to improve it

what is risk

a situation which has exposure to danger

three types of risks and define

finacial loss- when you borrow money to start up a business but need to profit to pay back this money
lack of security- security of income so need to work long hours

business failure-don't have enough money to cover the costs

rewards? 3 types

profit- to help business survive and grow
business success- growing business, good reputation

independence-make own decisions and wokring for urself

buisness plan?

a document outlining what a business wants to achieve

buisness idea

A business idea is the reason for starting a small business and the first step in the business development process

aims and objectives

overall target of the goal

market research

gathering data about customers or competitiors

purpose of business plan

A business plan allows an entrepreneur to minimise the level of risk when setting up a business.

sole trader define and a nd d

-a business that is owned and run by one person.
a-makes own decision, easy to setup, keep profits

d-unlimited liability-responsible for the debt-, long hours

partnerships define and a nd d

business that has two or more owners.
a-quick and easy to set up,shared decision-making shared responsibility for debt

d-conflict amongst owners, long work hours,one partner may let the others down and unlimited liability

private limited (ltds)

the shareholders purchase a share of the business.
a- limited liability, extra capital makes growth easier, more staff

d- expensive, decisions may take longer, share profits

public limited (plcs)

business that is managed by directors and owned by shareholder
a-limited liabilty, firm can become large, shares sold publicly, finace raised by selling shares

d- expensive, share profits, pay dividends, risk of takeover

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