Business Structure

Public sector

Business organisations that are owned and controlled by the government

Merit goods

-Goods which are under-provided by private sector businesses

For example: health care, education and public transport

Public goods

Goods where consumption by one person does not reduce the amount available to others, and once provided all individuals benefit

For example street lights

Privatisation

The transfer of public sector resources to the private sector

For example Train lines

Nationalisation

Private business taken from the private sector into state ownership to become public corporations in the public sector

Private sector

Businesses that are owned by individuals or groups of individuals

Sole trader

A business organisation which has a single owner

Partnership

A business organisation which is usually owned between 2 and 20 people

Deed of partnership

A binding legal document which states the formal rights of partners

Unlimited liability

Where the owner of a business is personally liable for all business debts.

The owner and the business are viewed as the same legal entity

Limited liability

Where a business owner is only liable for the original amount of money invested in the business

Limited company

A limited company that can only sell shares to freinds and family

Public limited company

A limited company that can sell shares to the general public

Floatation

The process of a company ‘going global’

Selling shares on the stock market

Shareholders

An individual, company or institution that own at least one share of a company's stocks, which is known as equity

Consumer co-operative

A business organisation which is run and owned jointly by the members who are customers rather than shareholders

Worker co-operative

A business organisation owned by employess who contribute to production and share in profit

Not-for-profit organisation

Organisations that are run according ti business principles, but that do not aim to make a profit

Social enterprise

A business that has specific social objectives. It seeks to maximise profit in order to maximise its social objectives. Profit is not its primary objective.