Business Structures and Their Implications

The video provides an overview of different types of business organizations, including sole traders, partnerships, franchises, joint ventures, private limited companies, and public limited companies. It discusses the advantages and disadvantages of each type, focusing on aspects like liability, capital, and continuity. The video also compares unincorporated and incorporated businesses and explains the role of the public sector. Finally, it addresses exam questions related to these topics.

What is a key advantage of being a sole trader?

• Ability to sell shares to the public

• Full control over the business

• Easy access to capital

• Limited liability

Which of the following is a disadvantage of a partnership?

• Potential for conflicts among partners

• Limited liability

• Inability to employ workers

• High setup costs

What is a major benefit of a franchise model?

• Access to local market knowledge

• Slow expansion

• No need for training and support

• High control over franchisee decisions

In a joint venture, what is a common disadvantage?

• Increased risk

• High individual costs

• Slow decision-making due to disagreements

• Lack of expertise sharing

What is a benefit of a private limited company?

• Control over who buys shares

• No need to pay dividends

• Unlimited liability

• Ability to sell shares to the public

What is a disadvantage of a private limited company?

• Limited access to capital

• No legal identity

• Unlimited liability

• No continuity

What is a key advantage of a public limited company?

• No legal requirements

• Limited access to capital

• Ability to sell shares on the stock market

• Full control over the company

What is a potential drawback of a public limited company?

• Limited liability

• No need to disclose accounts

• Potential loss of control

• No access to public stock markets

What is a characteristic of an unincorporated business?

• Ability to sell shares

• Separate legal identity

• Limited liability

• Unlimited liability

What is the primary objective of the public sector?

• To make a profit

• To improve the country

• To compete with private companies

• To reduce government spending