Business Ownership Structures and Management Styles
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Questions and Answers

What are the four main forms of business ownership?

  • Sole proprietorship, Partnership, Joint Venture, Cooperative
  • Sole proprietorship, Partnership, Corporation, Crown Corporation (correct)
  • Sole proprietorship, Partnership, Limited Liability Company (LLC), Franchise
  • Sole proprietorship, Partnership, Corporation, Nonprofit Organization

    • Which of the following is NOT a pro of a sole proprietorship?

  • Profits go directly to the owner
  • Unlimited liability (correct)
  • Be your own boss
  • Easy to start and end

    • Which of the following is a pro of a partnership?

  • Shared responsibilities (correct)
  • Unlimited liability
  • Limited capital
  • Difficult to dissolve

    • Which of the following is a con of a corporation?

    <p>Double taxation</p> Signup and view all the answers

    What is a key advantage of a Crown Corporation?

    <p>Providing essential services and jobs</p> Signup and view all the answers

    Which management style involves the manager making all decisions without input from employees?

    <p>Autocratic Style</p> Signup and view all the answers

    Which management style is considered most appropriate for creative tasks requiring teamwork?

    <p>Democratic Style</p> Signup and view all the answers

    Which management style is suitable when employees are experienced and knowledgeable?

    <p>Laissez-Faire Style</p> Signup and view all the answers

    Which management style is considered the best and why?

    <p>Democratic, because it focuses on a balanced approach, integrating teamwork and productivity.</p> Signup and view all the answers

    What does CSR stand for and what does it mean?

    <p>Corporate Social Responsibility. It means companies are responsible for their impact on society, the environment, and the economy. They go beyond just profit-making.</p> Signup and view all the answers

    CSR is only about making profits.

    <p>False</p> Signup and view all the answers

    What is the break-even point for a business?

    <p>The point where total revenue equals total costs.</p> Signup and view all the answers

    Society is interdependent, meaning that people and industries rely on each other and their actions affect each other's outcomes.

    <p>True</p> Signup and view all the answers

    What is the main role of the HR Department in a company?

    <p>To manage employees, including hiring, training, and benefits.</p> Signup and view all the answers

    What is debt financing?

    <p>When a business raises money by borrowing from external sources like banks or investors.</p> Signup and view all the answers

    How do you calculate profit?

    <p>Profit = Total Revenue - Total Expenses</p> Signup and view all the answers

    What is the term used to describe something a person or business owns?

    <p>Assets</p> Signup and view all the answers

    What does the law of demand state?

    <p>Higher prices lead to lower demand, and lower prices lead to higher demand.</p> Signup and view all the answers

    Which of the following is NOT a benefit of competition in a market?

    <p>Higher prices for consumers</p> Signup and view all the answers

    What is disposable income?

    <p>Gross pay minus deductions.</p> Signup and view all the answers

    What is discretionary income?

    <p>Disposable income minus necessary expenses.</p> Signup and view all the answers

    What is savings?

    <p>Discretionary income minus non-necessary expenses.</p> Signup and view all the answers

    What is the main difference between direct and indirect competition?

    <p>Direct competition is between businesses offering very similar products or services, while indirect competition involves businesses offering products or services that fulfill similar needs or wants.</p> Signup and view all the answers

    How do you calculate interest?

    <p>Interest = Principal x Rate x Time</p> Signup and view all the answers

    What is the relationship between Gross Income, Deductions, and Disposable Income?

    <p>Disposable Income is calculated by subtracting Deductions from Gross Income.</p> Signup and view all the answers

    Which of the following is the most liquid asset?

    <p>Cash</p> Signup and view all the answers

    A market surplus exists when there is more demand than supply.

    <p>False</p> Signup and view all the answers

    What is an import?

    <p>A good or service brought into a country from another country.</p> Signup and view all the answers

    What is the Fundamental Accounting Equation?

    <p>Assets = Liabilities + Equity</p> Signup and view all the answers

    Which of the following are examples of fixed long-term assets?

    <p>Land and buildings</p> Signup and view all the answers

    What is gross income?

    <p>All money earned before deductions, including income from jobs and investments.</p> Signup and view all the answers

    Which of the following are examples of current liabilities?

    <p>Accounts payable</p> Signup and view all the answers

    What is profit margin also known as, and how is it calculated?

    <p>Rate of return. Profit margin is calculated by dividing net income by revenue and multiplying by 100.</p> Signup and view all the answers

    What additional information is needed to more accurately assess two companies, beyond their balance sheets and income statements?

    <p>Debt levels, growth trends, and efficiency.</p> Signup and view all the answers

    What are two factors that can affect supply and demand?

    <p>Natural disasters disrupting production and a product becoming outdated.</p> Signup and view all the answers

    Robbin banks needs a $25,000 loan at 3% for 4 years. What are the total interest payments over the 4-year period?

    <p>$$1668.62$</p> Signup and view all the answers

    Which of the following is NOT a factor to consider when starting a business?

    <p>Personal interests</p> Signup and view all the answers

    Which of the following is NOT a key employability skill?

    <p>Artistic ability</p> Signup and view all the answers

    What are two advertising media you would choose to advertise the opening of a new amusement park in Sudbury, and why?

    <p>Social media platforms and radio advertising</p> Signup and view all the answers

    Which is more liquid: Land or Shares?

    <p>Shares</p> Signup and view all the answers

    Which is safer: GIC or Shares?

    <p>GIC</p> Signup and view all the answers

    Which has a higher rate of return: Savings account or Shares?

    <p>Shares</p> Signup and view all the answers

    Which is less liquid: RRSP or Shares?

    <p>RRSP</p> Signup and view all the answers

    Which has a lower rate of return: Chequing account or RRSP?

    <p>Chequing account</p> Signup and view all the answers

    What are the 4 P's of marketing?

    <p>Product, Place, Price, Promotion</p> Signup and view all the answers

    Study Notes

    Business Ownership Structures

    • Sole Proprietorship: Owned by one person; easy to start and end; owner keeps all profits; unlimited liability; financing can be difficult.
    • Partnership: Owned by two or more people; shared responsibilities and ideas; more capital available; potential for disagreements amongst partners; unlimited liability; shared profits.
    • Corporation: Owned by shareholders with a board of directors; limited liability for owners; easier transfer of ownership; complex and costly start-up; double taxation; lack of direct decision-making by owners.
    • Crown Corporation: Owned by the government; provides essential services and jobs; competition might be affected; tax-funded.

    Management Styles

    • Autocratic: Manager makes all decisions; appropriate for emergencies; high short-term productivity but can lower morale; example: sports coach.
    • Democratic: Manager involves employees in decision-making; appropriate for creative tasks; employees feel involved and work harder; more time-consuming; example: elections.
    • Laissez-Faire: Manager allows employees to make decisions independently; appropriate for experienced employees; good for skilled teams but not for those needing guidance; example: independent creative work.

    Corporate Social Responsibility (CSR)

    • Definition: Businesses taking responsibility for their social, environmental, and economic impact beyond profit.
    • Importance: Builds customer trust (e.g., ethical sourcing); boosts employee morale (e.g., charitable donations); promotes long-term growth (e.g., sustainable practices).

    Financial Concepts

    • Break-even point: Total revenue equals total costs.
    • Interdependence: People and industries relying on each other; actions affect each other's outcomes.
    • Human Resources (HR): Manages employees (hiring, training, benefits).
    • Debt financing: Borrowing money from external sources with interest payments.
    • Profit calculation: Profit = Total Revenue - Total Expenses.
    • Assets: Items a business owns.
    • Law of demand: Higher price, lower demand; lower price, higher demand.
    • Competition benefits: Innovation, motivation, differentiation.
    • Disposable income: Gross pay minus deductions.
    • Discretionary income: Disposable income minus necessities.
    • Savings: Discretionary income minus non-necessities.
    • Direct competition: Competitors offering similar products/services (e.g., McDonald's vs. Burger King).
    • Indirect competition: Competitors offering substitute products/services (e.g., Netflix vs. traditional cable TV).
    • Interest calculation: Interest = Principal × Rate × Time.
    • Liquid assets: Easily converted to cash (e.g., cash).
    • Market surplus: More supply than demand.
    • Import: A good or service brought into a country.
    • Fundamental accounting equation: Assets = Liabilities + Equity.
    • Fixed assets: Land, buildings, machinery, vehicles (long-term).
    • Gross income: All income before deductions.
    • Current liabilities: Accounts payable and operating expenses.
    • Profit margin (return): Net income ÷ revenue × 100 (0-5% low, 10-20% decent, 20%+ great).

    Business Analysis

    • Assessing companies: Consider debt levels, growth trends, and efficiency besides balance sheets and income statements.

    Supply and Demand

    • Factors affecting supply and demand: Natural disasters disrupt production; a product becomes obsolete.

    Loan Calculations

    • Loan calculations (example): Calculate loan payments and interest using provided formulas.

    Starting a Business

    • Startup factors: Market research, business plan, funding, location, skills.

    Employability Skills

    • Employability skills: Communication, problem-solving, teamwork.

    Advertising

    • Advertising media (example): Social media and local radio stations (pros and cons of each).

    Financial Considerations

    • Liquidity: Shares are more liquid than land; GICs are safer than shares.
    • Return: Shares have a higher return potential than savings accounts; RRSPs are less liquid than shares but can offer tax benefits.
    • 4 Ps: Product, Place, Price, Promotion.
    • 2 Cs: Competition, Consumer (target market)

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    Description

    This quiz focuses on understanding various business ownership structures such as sole proprietorships, partnerships, and corporations, as well as management styles like autocratic and democratic leadership. Test your knowledge on the advantages and disadvantages of each structure and style, and learn how they impact business operations. Perfect for students of business studies or anyone looking to deepen their understanding of organizational dynamics.

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