1.2 Types of Organizations | 2021 - Business Management

Which of the following statements best applies to public-private partnerships (PPPs)?

•   PPPs aim to maximise profits

•   The private sector usually provides the expertise

•   They are limited to small partnerships

•   The public sector usually provides the funding

Answer explanation

The private sector usually provides the expertise in a PPP, while the government assists with the funding.

What is the legal agreement that sets out the rules of how a partnership operates known as?

•   Memorandum of partnership

•   Deed of incorporation

•   Articles of partnership

•   Deed of partnership

Answer explanation

A deed of partnership refers to the legal document which outlines the rights and obligations of each owner involved in a partnership. The other options are fictitious terms.

What is the sector consisting of businesses owned by private groups or individuals known as?

•   Private sector

•   Public sector

•   Secondary sector

•   Voluntary sector

Answer explanation

As the name suggests, the private sector refers to businesses owned by private individuals, groups and organizations.

What is the term used to describe businesses owned or operated by the government?

•   Private sector

•   Public sector

•   Secondary sector

•   Voluntary sector

Answer explanation

As the name suggests, the public sector refers to businesses owned by the government on behalf of the general public.

 _______ ___________ - This is a special type of partnership where some partners contribute capital and enjoy a share of the profits but do not participate in the running of the business.

___-______ ____________ - A commercial organization sells goods and/or services in order to earn a profit for its owners.

If a business has ‘unlimited liability’, what is the responsibility of the owners?

•   Paying suppliers within the credit period

•   Paying dividends to shareholders

•   Paying none of the debts of the business

•   Paying all of the debts of the business

Answer explanation

Unlimited liability refers to a situation when the owners of a business share responsibility for the debts of a business.

___-______ ____________ - A business that does not primarily aim to earn a profit but to serve a purpose beyond the organization itself, for the betterment society as a whole.

______ ___________ - These organizations are revenue-generating businesses with community (social) objectives at the core of their operations in order to benefit the general public, rather than private shareholders.

____ __ ___________- A legally binding contract that all joint owners of a partnership sign, stating the purpose of the business, the formal rights of the partners, and how any profits should be split.