Economics

Front 1

sole proprietorship

Back 1

a business owned and run by one person

Front 2

advantages of a sole proprietorship

Back 2

1. little effort in starting up
2. decisions are made quickly
3. owner enjoys profits without having to share
4. doesn't have to pay sepaate business taxes

Front 3

sole proprietorship disadvantages

Back 3

1. owner has unlimited liability
2. difficuity in raising financial capital
3. size and efficiency
4. owner has limited experience
5. difficuliy of attracting qualified employees.
6. limited life

Front 4

limited life

Back 4

business does not exisit anymore when owner dies, quits, or new owner is added applies to sole proprietorships or partnerships

Front 5

unlimited liability

Back 5

owner is personally and fully responsible for all loses and debts of the business

Front 6

inventory

Back 6

a stock of finished goods and parts in reserve to satisfy customers or to keep production flowing smoothly

Front 7

partnership

Back 7

a business is jointly owned by two or more people

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advantages of a partnership

Back 8

1. little effort in establishment
2. lack of special taxes
3. can usally attract financial capital easier
4. larger size, makes for more efficient operations

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disadvantagesvof a partnership

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1. each partner is responible for the acts of all other partners

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disadvantages of a partnership

Back 10

1. each partner is responsible for the acts of all the other partners
2. conflicts may occur between partners

Front 11

bankruptcy

Back 11

court granted premission for an indivual or business to cease or delay debt payments

Front 12

corporations

Back 12

a form of a business organization recongized by law as a seperate legal entity having all the rights of an indiviual

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charter

Back 13

a government document that gives permission to create a corporation

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stock

Back 14

certificate of ownership in a corporation

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stockholder

Back 15

person who owns stock in a corporation

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dividend

Back 16

check paid to stockholders

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credit union

Back 17

a financial organization that accepts deposits from and makes loans to employees of a certin company or government agency

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advantages of a corporation

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1. easy to raise financial capital
2. directors of corporation can hire professional mangers to run the firm
3. provides limited libility for owners
4. unlimited life

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bond

Back 19

written promise to repay the amount borrowed at a later date

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disadvantages of a corporation

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1. difficulty and expense of getting a charter

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disadvantages of a corporation

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1. difficulit and expensive to get a charter
2. double taxation of corporate profits

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double taxation

Back 22

dividends are taxed twice

Front 23

merger

Back 23

a combonation of two or more business to form a single firm

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income statement

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a report showing a business's sales, expenses and profits for a certian period of time

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net income

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the measure if a business profits determined by subtracting all expenses, including taxes, from revenues

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depreciation

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a non-cash charge the the firm takes for the general wear and tear on it's capital goods

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cash flow

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the sum of net income and non-cash charges

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horizontal merger

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when two or more firms that produce the same kind of product and join forces

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vertical merger

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when firms involved in different steps of manufacturing or marketing join together

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conglomerate

Back 30

a firm that has at least four business, each making unrelated products

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multinational

Back 31

a corporation that has manufacturing or serivce opperarions in a number of different countries

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nonprofit organization

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operates in a businesslike way to promote the collective intrests of its members rather then to seek financial gain

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nonprofit organization

Back 33

operates in a businesslike way to promote the collective intrests of its members rather then to seek financial gain

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nonprofit organization

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operates in a businesslike way to promote the collective intrests of its members rather then to seek financial gain

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cooperative or co-op

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a voluntary association of people formed to carry on some kind of economic activity that will benefit its members

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credit union

Back 36

a financial organization that accepts deposits from and makes loans to employees of a certin company or government agency

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credit union

Back 37

a financial organization that accepts deposits from and makes loans to employees of a certin company or government agency

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labor union

Back 38

organization of workers formed to represent its members intrests in various employment matters

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collective barganing

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when it negotiaties with management over job related matters such as health care coverage

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professional associations

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a group of people in a specialized occupation that works to improve things like the working conditions.

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chamber of commerce

Back 41

promotes the welfare of its members and of the community

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better business bureau

Back 42

a non-profit organization sponsored by local business to provide general information on companies

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limited partnership

Back 43

form of partnership where one or more partners are not active in the daily running of the business