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Questions and Answers
What is a characteristic of a sole trading business?
What is a characteristic of a sole trading business?
A sole trader does not keep all the profits generated by their business.
A sole trader does not keep all the profits generated by their business.
False
What is an example of a sole trading business?
What is an example of a sole trading business?
A plumber
In a sole trading business, the owner bears all __________ and keeps all profits.
In a sole trading business, the owner bears all __________ and keeps all profits.
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Match the features of a sole trading business with their descriptions:
Match the features of a sole trading business with their descriptions:
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Which of the following is not a source of business ideas?
Which of the following is not a source of business ideas?
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A unique business idea is essential for attracting customers.
A unique business idea is essential for attracting customers.
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Name one key characteristic of a business idea.
Name one key characteristic of a business idea.
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The first step to set up an enterprise is to select a ________ idea.
The first step to set up an enterprise is to select a ________ idea.
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Match the following steps to set up an enterprise with their descriptions:
Match the following steps to set up an enterprise with their descriptions:
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Study Notes
Business Organizations
- A business organization is a structure established by entrepreneurs to produce or trade in goods and services.
- A sole trading business is owned and controlled by one entrepreneur, also known as a sole proprietor. Examples include a dhool puri seller, plumber, or dentist.
- A sole trading business features one owner, single source of capital, owner bears all risks and keeps all profits, and unlimited liability.
- Unlimited liability means in case of bankruptcy, the owner’s personal belongings may be used to pay debts.
Advantages of a Sole Trading Business
- Easy setup and operation
- Little capital required
- All profits belong to the sole trader
- Decisions are made quickly
Disadvantages of a Sole Trading Business
- Limited capital for expansion
- Sole trader bears all risks and responsibilities
Sources of Business Ideas
- Family, friends, and relatives
- Internet and magazines
- Surrounding environment and locality
- Hobbies and activities
- Qualifications and experiences
Key Characteristics of a Business Idea
- Uniqueness: Attracts customers with a distinct offering.
- Innovation: Involves creating unique and valuable ideas.
- Attractiveness: Appeals to a large customer base.
Steps to Set Up an Enterprise
- Business Idea: Chosen individually or with partners.
- Type of Business: Determined based on legal structures and operations.
- Business Name: Appealing and engaging.
- Business Location: A designated physical address.
- Registration: Adherence to legal formalities.
- Sources of Funds: Owner's savings, bank loans, borrowing from friends.
- Organizing Resources: Careful management and organization of resources.
- Launching the Product: Choosing a suitable time and place, considering consumer preferences.
- Business Plan: A comprehensive document outlining the business's activities.
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Description
This quiz explores the concept of sole trading businesses, including their structure, advantages, and disadvantages. Learn about the unique characteristics of sole proprietorships and how they operate in the market. Ideal for understanding the fundamentals of business organizations.
