Unit 1.

2: Review Questions

Task 1: Complete the missing words

1) A ________________ is a business owned and operated by a single person. There are _______ legal
procedures involved in setting it up. The owner bears all the ______ of running the business, due to ___________
liability, meaning that he or she may need to sell personal possessions to meet the debts that the business cannot
cover. However, they keep all of the ___________ and make all of the ________.

2) An ordinary __________ is an alliance between ____________ individual owners who are jointly responsible
for the business. These joint owners will usually sign a ______________________, which acts as a contract,
stating profit sharing, responsibilities and drawings allowed. Most owners have ___________ liability. A key
advantage is access to more _________ and __________. However, problems such as ____________ and
sharing ________ also occur. Those owners who simply invest but have no direct involvement in the business are
known as __________________. These partners enjoy _____________________.

3) Companies are owned by _____________ who have __________ liability. This is because the company is
______________, meaning the owners and business are separate _________ entities. The owners get one
_______ for each share they hold, and can use this during the ___________________, where the board of
directors are voted in. ___________ companies tend to be small and owned by friends and families. They are
shown by the letters _____ after the name. They do not have to share their ____________ data with the public,
unlike ___________________________ (PLC). PLC’s sell their shares on the _________________, allowing
them access to larger sources of ___________. This initial offer is known as a _________________________
(IPO). In return for investment, shareholders receive ___________ payments, which are usually paid _______
yearly. They also hope to receive a _________ gain (ie rise in share prices).

4) Cooperative are _______________ enterprises owned and run by its ___________, usually workers and
customers. Any profit is known as a __________, and is shared equally. Decision making is based on the idea of
___________________, so that everyone has the same amount of power.

5) _______________ is a type of financial service aimed at entrepreneurs of ________ businesses, especially

females and those on _____ income. It enables entrepreneurs to access finance to help them out of _________.
However, __________ can be high and at times some of the providers take advantage of their need for money,
and are more driven by ______ than _______ enterprise.

6) ________________________ occur when the government works together with the _________ sector to jointly
provide certain goods and services. The agreement can benefit from the finance and efficiency of the
____________, and the support and funding of the ______________. The main problem is the differing
____________ of each side.

7) __________________________(NPSE) are businesses run in a commercial like manner but without profit being
the main goal. Instead, ________________________ (NPO’s) use their _________ revenues (excess revenue
over expenditure) to achieve social goals rather than distribute to as profits or dividends. Non-governmental
organizations (NGO’s) operate in the __________ sector. A ________ provides voluntary support for good causes.
Its key function is to raise ________ from individuals or organizations. They have _________ liability and do not
have to pay any _____ (as there is no profit!), but have problems such as _______ (misuse of funds) and
________________ (many restrictions on what they can and cannot do).
Task 2: Complete the crossword - you are given the definition but must find the key term

Across
3. A marketplace for
trading stocks and
shares

4. An annual meeting of
shareholders allowing
them to vote (initials)

6. Private sector
business owned by 2-20
people.

9. A self-employed
person who runs and
controls a business

10. For-profit social

enterprises set up,
owned and run by their
members

12. A business owned

by shareholders with
limited liability with
shares sold to friends
and family (initials)

13. The number of votes

each member is given in a cooperative

20. When a business and owners are legally liable for all monies owed to their creditors, even if they have to sell their
private assets to pay for them.

21. A legal difference from partnership and sole traders, meaning that companies can still operate even if there is a change
of ownership

Down
1. Means that there is a legal difference between the owners of a company and the business itself.
2. These are the ones who own and run cooperatives
5. Type of financial service aimed at low income entrepreneurs, especially females.
7. Private sector not-for-profit social enterprises that operated for the benefit of others (initials)
8. (Occurs when a business sells part of its company to shareholders on a stock exchange for the first time (initials)
11. (Occur when the government works together with the private sector to jointly provide certain goods and services (initials)
14. This sector is not run by the government
15. This type of partner invest money but is not involved in the running of the partnership.
16. Is a restriction on the amount of money that owners can lose if their business gos bankrupt.
17. A contract between partners stating such things as responsibilities and profit sharing.
18. Incorporated business that allows the general public to buy shares in a company via the stock exchange. (initials)
19. Elected by shareholders to run the company on their behalf (initials)