UNIT 6: CLASSIFICATION OF BUSINESSES

primary sector

extracts and uses the natural resources of Earth to produce raw materials used by other businesses

secondary sector

manafacturing goods using the raw materials provided by the primary sector

tertiary sector

provides services to consumers and the other sectors of industry

quaternary sector

includes intellectual services such as technological advancement and innovation

mixed economy

economy has both a private sector and a public (state) sector

public sector

the sector of econ in which orgs are owned and controlled by the state (government)

private sector

the sector of econ in which orgs are owned and controlled by individuals

privatisation

the sale of state-owned assets such as public corporations to the private sector

sole trader

a business owned and operated by one person

limited liability

the liability of shareholders in a company is limited to only the amount they invested

unlimited liability

the owners of a business can be held responsible for the debts of the business they own (not limited to the investment they made)

partnership

a form of business in which two or more people agree to jointly own a business

shareholders

the owners of a limited company --> buy shares which represent part-ownership of the company

private limited companies

business owned by shareholders but they cannot sell shares to the public

public limited companies

business owned by shareholders but they can sell shares to the public and their shares are tradable on the Stock Exchange

franchise

a form of business operation in which a business (the franchisor) allows another person or company (the franchisee) to use its brand, products, and business model in return for a fee or royalties.

joint ventures

A form of business arrangement in which two or more businesses agree to work together on a specific project or business activity while remaining separate legal entities.

shares

One of the equal parts that the ownership of a company is divided into, and that can be bought by the public.

liability

A legal responsibility for debts or obligations.

prospectus

A formal document that provides information about a company and its shares to potential investors.

creditor

A person or organization to whom money is owed.

>< DEBTORS