GCSE Business PLCs and Limited Companies

What does PLC stand for?

• Private limited company

• Popular limited company

• Professional limited company

• Public limited company

Which of the following statements is true of a private limited company?

• Shares cannot be sold to outside investors

• Anyone can buy shares

• The owners have limited liability

• The owners have unlimited liability

Which of the following statements is true of a PLC [public limited company]?

• The total amount of share capital is very small

• Shares can be bought and sold by investors

• Anyone can buy shares

• The business is likely to be owned by one family

Which of the following is NOT a feature of a Memorandum of Association

• It states the rules of the company

• It states the aims of the company

• It states the powers of the company

• It defines the relationship with shareholders

What is the purpose of Articles of Association?

• Identifies the company's product

• Identifies the rules of the company

• Identifies the marketing strategy

What is meant by the term 'incorporation'?

• Two businesses joining together

• One business taking over another

• Setting up a business as a separate legal entity.

• Two separate businesses working together

In the UK which type of business requires at least 50,000 pounds to set up?

• Franchise

• Limited company

• Sole trader

• PLC

Which of the following is a good reason for a sole trader to form a limited company?

• It will be necessary to publish the business's accounts

• Legal documents will have to be completed

• The owner's liability for business debt is limited for the first time

A business prospectus has what purpose?

• To attract new partners to a partnership

• To show how well a PLC has performed

• To advertise products to customers

• To make the business attractive to potential investors

Which of the following is a good reason for a limited company to become a PLC?

• It may become more difficult to reinvest profit to improve the business

• The quantity of share capital in the business is likely to increase a lot

• As a PLC the business may be subject to a takeover

• The owners of the limited company may lose control of the business