L1 Business Characteristics

What are the three main types of business ownership structures?

• Private, Public, Voluntary

• Individual, Group, Public

• Sole Trader, Partnership, Company

• Limited, Unlimited, Shared

What is the main difference between a sole trader and a company in terms of liability?

• Both sole traders and companies have limited liability

• Sole traders have unlimited liability, while companies have limited liability

• Sole traders have limited liability, while companies have unlimited liability

• Both sole traders and companies have unlimited liability

What is the main advantage of forming a company as a business structure?

• Shared responsibility and workload

• Simplest and cheapest business to establish

• Spreads risk and offers limited liability

• Much greater access to capital

What are the factors of production used by businesses to produce goods and services?

• Innovation, Quality, Efficiency, Profit

• Products, Services, Customers, Revenue

• Money, Technology, Resources, Marketing

• Land, Labour, Capital, Enterprise

What are the important goods and services provided by the public sector known as?

• Merit goods

• Consumer goods

• Luxury goods

• Necessity goods

What is the main reason for the decline in employment in the primary and secondary sectors in New Zealand?

• Increased demand for goods and services

• Decreased competition from overseas countries

• Cheaper labor costs in overseas countries

• Government regulations on employment

What is the aim of the voluntary and not-for-profit sector in providing goods and services?

• To maximize profits for the owners

• To run with minimal costs and direct most funding to providing the service

• To compete with private sector businesses

• To generate revenue for the government

What is the main characteristic of small and medium-sized enterprises (SMEs) in the New Zealand economy?

• They are more productive and pay higher wages

• They make up the majority of businesses and are the backbone of the economy

• They are less successful in international markets

• They have limited access to finance

What is the main disadvantage of a partnership business structure?

• Shared responsibility and workload

• Fees associated with creating and operating the partnership

• Potential for decision-making conflict and stalemate among partners

• Limited access to finance

What is the main advantage of a sole trader business structure?

• Shared responsibility and workload

• Simplest and cheapest business to establish

• Spreads risk and offers limited liability

• Much greater access to capital