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marshall business organizations

Terms in this set (44)

Disadvantages of Proprietorship
unlimited liability, limited management, limited financial resources, success depends on health, difficult in attracting good employees, high rate of failure
easy to start, you are the boss, all profits are yours easy to dissolve, no taxes on profits
Advantages of Proprietorship
few large firms, each of the firm's strategy can affect the other firms, and entry to this industry is difficult
Oligopoly
monopolistic competition
each firm produces a small share of the total output, very vigorous competition, and very narrow price range
all products are standardized, there are many independent sellers and buyers, and it is easy to enter or leave the market
pure competition
pure monopoly
there is only one producer, only one seller, and most are illegal in the US
List the four markets available for use by businesses within the US.
pure competition, monopolistic competition oligopoly, and pure monopoly
A facility where production
takes place
plant
are plants related to a firm
yes
Vertical Integration
a firm that owns several plants , that each handles a different stage or process within the production process; example- Ford.
Horizontal Integration
a firm that owns several plants, each doing their own thing; example- AT&T
conglomerate
a firm that produces a wide variety of goods and services at many unrelated markets.
proprietorship
a firm owned by one person
partnership
firm owned by two people
corporation
owned by two or more people
advantages of partnership
few restrictions, more opportunity, no tax, shared losses, greater financial resources
Disadvantages of Partnership
unlimited liability, independence of action lost, freezing of each investment, conflict between partners
advantages of corporation
limited liability, easier to merge, greater financial resources, unlimited life, easy to transfer ownership, professional managers, better hiring ability
Disadvantages of a corporation
separation of ownership and management, merge may be restricted, stockholders have little control, double taxation, costly to form, a lot of regulations
Proprietorship accounts for 72% of all business firms. Partnerships account for 5% of sales and proprietorship account for 23% of all profits
What accounts for 72% of all business firms? 5%? 23%
Secret Partner
partnership where one partner actively participates in managing the firm but their identity is anonymous to the public
dormant partner
a partner who is neither known to the public as a partner or active in management.
silent partner
An individual who takes no active part in the management of a partnership but is known as an owner in the business
cooperative association
is a voluntary association of persons formed to carry on some kind of economic activity that will benefit its
members.
consumer cooperative
Is one in which people join together to buy such commodities as food, clothing, and drugs at low prices.
Example: AARP
service cooperative
One in which a number of persons join together to get special services.
producer coopertive
Members produce commodities sell at the highest prices example: farmers
capital
Lifeblood of a business; used to pay day to day expenses
borrowing
Used to obtain and use items needed before the corporation has to pay for them.
the public
who lends money when they buy bonds
consolidation
The joining of two or more firms to form a new firm.
monopolistic competition
what type of competition has Many firms
Vigorous competition
Product differentiation
Use advertisements, colors, etc.
oligopoly
what economic market is dominated by a few large firms
70% - 80 % of sales
Each strategy can affect others
Non-price competition
Product differentiation
Entry is difficult
short
what is the life of a business
1 out of 5
how many businesses survive
pure monopoly
One producer
One seller
No close substitute
QUALITY LOW
PRICE HIGH
NO VARIETY
technological monopoly
monopoly created with patents or copyrights
natural
what monopoly has certain industries
geographical
monopoly maintained through location
profit-seeking enterprise
What type of enterprise is a business organization?
a business trust
when properties and assets of a business corporation are trusted to a trustee.
27 million
About how many US businesses are in operation currently within the US.
board of directors
group of people who are given the power to to govern the corporation's affairs and take care of general policy.
selling stocks, through credit, and through the public
What are the 3 ways to finance a corporation?
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