Forms of Business Organization

and its Role in Social Economic

Development
Match the description of each word in Column I with its meaning in Column II.

Column I Column II
1.Easily exchanged for goods and services A. Acceptable
2. Money is universally accepted B. Convertible
3. Long lasting C. Divisible
4. Can be easily broken down into smaller units D. Durable
5. Easy to carry E. Homogenous
F. Portable
Ever since the birth of free enterprise, all kinds of
businesses have influenced society one way or another.
Business, also known as an enterprise, agency, or
firm, is an entity involved in the provision of goods
and/or services to consumers. Businesses are
prevalent in capitalist economies, where most of them
are privately owned and provide goods and services to
customers in exchange for other goods, services, or
money.
The characteristics of Money
1. Acceptable - money is universally accepted
2. Convertible - easily exchanged for goods and services
3. Divisible - can be easily broken down into smaller units
The characteristics of Money
4. Durable - long lasting
5. Homogenous - similar example: all 100 bills
are the same in appearance
6. Scarce - this ensures its value
7. Portable - easy to carry
An organization is a system that groups
people together towards establishing a
common goal. Business organizations are
centered on creating goods and services for
profit.
 Types of Business Organizations
1. Conglomerate - a group of unrelated
companies under one umbrella. A parent
company owns a controlling stake in each
company which conducts business separately.
(e.g., Restaurant, shoe store, travel agency,
etc.)
2. Cooperatives -business entities owned by their
members who purchase shares to join them. They are
usually established because of a need existing among a
number of persons who wish to acquire goods and
services at a reasonable cost. (e.g., Retail Consumer
2. Cooperatives -business entities owned by their members who purchase shares to join them. They are usually established
because of a need existing among a number of persons who wish to acquire goods and services at a reasonable cost. (e.g., Retail
Consumer cooperatives and Producer cooperatives)

cooperatives and Producer cooperatives)

3. Franchise – an agreement between the person
requesting permission to set up business and the
parent company to allow the franchisee to sell its
product or services. Many multinational companies
expand into new regions through franchises. (e.g.,
Jollibee, McDonalds, Choking, etc.)
4. Government department – includes the
government ministries that are very important to
the running of government. (e.g., The Ministry of
Finance and Education)
5. Local and municipal authorities – these bodies
fulfill local needs and allow for more balanced local
development.
6. Nationalized industries – are government owned and
controlled businesses. They provide essential services
such as water, electricity and transportation. They carry
out duties such as cleaning gullies and drains and fixing
community roads. (e.g., water company providing
standpipes to rural communities)
7. Partnership – formed legally by a
minimum of two and a maximum of
twenty persons in a business.
 Starting a business requires a lot of hard work.
Therefore, persons must be ready when deciding to
start up a business to dedicate a lot of time and
energy to the start-up. It is also very costly and
therefore capital will have to be identified to inject
into a new business.
 REASONS FOR STARTING A BUSINESS
1. Being your own boss where you can make
decisions about the direction and operation of
the business.
2. Financial independence where starting the
business would give you the opportunity to be a
successful businessperson and achieve financial
independence.
 REASONS FOR STARTING A BUSINESS
3. Self-actualization/Fulfillment in which owning and
operating a successful business will give a feeling of
accomplishment.
4. Creation of employment for relatives, friends and
community members which can assist in providing jobs for
persons in communities with high levels of unemployment.
5. Use of skills and knowledge for yourself where the skills,
knowledge and experience that you have acquired can be
put to work for you.
ASSESSMENT
1. Mr. Ballesteros, an owner of money exchange
company attends different seminars about
money. Which of the following is/are
characteristics of money?
I. Visible
II. Acceptable
III. Convertible
IV. Portable
I. Visible
II. Acceptable
III. Convertible
IV. Portable

A. I only
B. I and II
C. I, II and III
D. II, III and IV
2. It is the characteristic of money which can be easily
broken down into smaller units.
A. Acceptable
B. Convertible
C. Divisible
D. Portable
3. It is the characteristic of money which it is easy to
carry
A. Acceptable
B. Convertible
C. Divisible
D. Portable
4. An organization is a system that groups people
together towards establishing a common goal.
Interpret which o the following statement is TRUE
about conglomerate type of business organization.
I. A group of unrelated companies under one umbrella.
II. A parent company owns a controlling stake in each
company which conducts business separately.
III. Examples are Restaurant, shoe store and travel agency
IV. They provide essential services such as water, electricity
and transportation.
A. I only
B. I and II
C. I, II and III
D. IV only
5. A business entities owned by their members
who purchase shares to join them.
A.Cooperative
B.Franchise
C.Nationalized Industries
D.Partnership
6. An agreement between the person
requesting permission to set up business and
the parent company to allow the franchisee to
sell its product or services.
A.Cooperative
B.Franchise
C.Nationalized Industries
D.Partnership
7. Ever since the birth of free enterprise, all kinds of
businesses have influenced society one way or another.
Which of the following is another term for business?
I. Agency II. Enterprise III. Firm IV. Entrepreneurship

A. I only
B. I and II
C. I, II and III
D. IV only
8. Reason for starting a business where starting the
business would give you the opportunity to be a
successful businessperson and achieve financial
independence.
A. Being your own boss
B. Financial independence
C. Self-actualization/Fulfillment
D. Use of skills and knowledge for yourself
9. Reason for starting a business in which owning and
operating a successful business will give a feeling of
accomplishment.
A. Being your own boss
B. Financial independence
C. Self-actualization/Fulfillment
D. Use of skills and knowledge for yourself
1. A0 B1 C2 D3
2. C
3. D
4. A1 B2 C3 D0
5. A
6. B
7. A1 B2 C3 D0
8. B
9. C
Group Activity 1:KWL Chart
Using the KWL Chart, write down what you know about the topic
in the What I Know column. Then, in the form of a question
write the things that you want to know in the What I Want To
Know column. Lastly, in the What I Learned column, write what
has been added to your knowledge in business.

K-W-L CHART
What I Know What I Want What I
To Know Learned
Group Activity 2: Let’s Travel

Make a TRAVELOGUE of different business

organization in CAVITE.
Activity No. 3
Direction: As a future businessperson, discuss the
importance of business in today’s generation and
create your own reason for starting a business.