U1 AOS2 L2 - Types of Business Structures

Outline the similarities and differences between a sole trader and a partnership.

• A sole trader has unlimited liability, while a partnership has limited liability.

• Both a sole trader and a partnership involve multiple owners.

• A sole trader and a partnership are both taxed as separate legal entities.

• A sole trader is owned by one person, while a partnership is owned by two or more people.

The relationship between the internal environment and the external environment of a business is:

• independent and unrelated

• interdependent and dynamic

• static and predictable

• competitive and hostile

Fill in the blank: Types of businesses include ______, partnership, private limited company, public listed company, social enterprises, and government business enterprises.

• sole proprietorship

• corporation

• non-profit organization

• cooperative

Which of the following is a type of business model?

• Online business

• Direct-to-consumer business

• Bricks-and-mortar business

• All of the above

What are the costs and benefits of purchasing an existing business compared with establishing a new business?

• Purchasing an existing business often involves higher initial costs but provides immediate cash flow and established customer base, while establishing a new business may have lower initial costs but requires building everything from scratch.

• Purchasing an existing business is always cheaper and more beneficial than starting a new one.

• Establishing a new business is always more cost-effective and beneficial than buying an existing one.

• There are no significant differences between purchasing an existing business and establishing a new one.

Fill in the blank: Business resource needs include natural, labour, and ______, and the factors affecting the use of business resources.

• capital

• technology

• management

• innovation

Which of the following factors affect the choice of business location?

• Proximity to customers

• Availability of raw materials

• Cost of labor

• All of the above

What are the sources of finance available to establish a business and the factors affecting the type and source of finance chosen?

• Equity, debt, and grants; market conditions, business size, and risk

• Only equity and debt; interest rates and inflation

• Grants and loans only; government policies

• Personal savings only; economic stability

Which of the following is a business support service?

• Legal

• Financial

• Technological

• All of the above

The purpose of planning analysis tools such as SWOT analysis in business is to:

• Identify strengths, weaknesses, opportunities, and threats

• Increase sales and revenue

• Hire new employees

• Expand into new markets