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NATURE OF A BUSINESS (Important Terms Used in Business (Enterprise,…
NATURE OF A BUSINESS
Important Terms Used in Business
Enterprise
Entrepreneur
Organisation
Economy
Producer
Consumer
Exchange
Trade
Barter
Profit
Loss
Goods
Service
Commodity
Market
Capital
Labour
Specialisation
Reasons for Establishing a Business
To make an idea into a reality
Financial independence
Being your own boss
Use of skills and knowledge for yourself
Self-actualisation and self-fulfillment
Job security
To create employment opportunities
Types of Economic Systems
Mixed economies
Command or socialist economies
Free market or capitalist economies
Traditional or subsistence economy
Function of a Business
To provide goods and services
To make profits
To create employment
The Role of a Business in a Community
Economic and financial role of a business
Social and political role of a business
Ethical and environmental role of a business
Transition from a Subsistence Economy to a Money Economy
Subsistence economy
Money economy
Bills of exchange
Credit cards
Telebanking
Electronic funds transfer (EFT)
E-commerce
The Different Forms of Business Oganisations
Private sector
Sole traders or sole proprietorships
Partnerships
General partnerships
Limited liability partnerships
Cooperatives
Consumer cooperatives
Producer cooperatives
Marketing cooperatives
Financial cooperatives
Farmers cooperatives
Housing cooperatives
Companies
Limited liability companies
Private unlimited companies
Public limited companies
One man or one person companies
Conglomerates
Holding compnaies
Multinational corporation (MNCs) and transnational corporations (TNCs)
Syndicates
Joint ventures
Franchises
Public sector
State-owned enterprises (SOEs)
Nationalised industries
Statutory body or agency
Governmental departments (ministries)
Local governments and muncipalitites
The Role of Stakeholders in Business Activities
Internal stakeholders
Owners
Investors/banks
Employees
External stakeholders
Consumers
Governments
Society