Understanding Different Business Aims and Ownership

Flashcards covering business aims, costs, unique selling propositions (USP), and different forms of business ownership with their associated liabilities.

What is the primary objective of 'profit maximisation' as a business aim?

Lowering costs and other aspects to maximise the profit made.

What does 'growth' as a business aim typically involve?

Expanding through new stores, new lines of products, or similar initiatives.

What is the 'survival' aim for new businesses?

To stay operating by making enough profit to cover costs.

What are 'variable costs' in a business?

Costs that change, such as raw materials or employee wages (piece-rate).

What are 'fixed costs' in a business?

Costs that do not change regardless of the level of production or sales.

How can a business add unique features, also known as a USP?

By incorporating new packaging, a new product feature, or through branding like logos.

What type of liability is associated with a sole trader business?

Unlimited liability, meaning the owner is personally responsible for all business debts.

How is a partnership structured according to the notes, specifically regarding the number of owners and liability?

It involves 2-50 partners and offers limited liability.

What defines a Private Limited Company (Ltd) in terms of shareholding and liability?

It sells shares privately and provides limited liability to its owners.

What defines a Public Limited Company (PLC) in terms of shareholding and liability?

It sells shares on the stock market and provides limited liability to its owners.