3.1 business organizations
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3.1 Business Organizations. Persons and Organizations that use or represent the Factors of Production Business Organization Profit seeking enterprise that serves as the main link between scarce resources and consumer satisfactions Compete with each other. Economic Institutions. What is it? - PowerPoint PPT PresentationTRANSCRIPT
3.1 Business Organizations
Economic Institutions
• Persons and Organizations that use or represent the Factors of Production• Business Organization• Profit seeking enterprise that serves as
the main link between scarce resources and consumer satisfactions• Compete with each other
Sole Proprietorship
•What is it?•How big are they?•Are they profitable?
Sole Proprietorship - Formation
• Is it difficult to start one?•What do I do?•Yeah, but I bet there’s lots of red tape and fees and stuff, right? Right?
Sole Proprietorship – Ask Yourself
• What is the goal of my business?• What am I going to sell?• Where is my headquarters going to be?• Where am I going to get my products?• What type of consumers am I going to
target?
Sole Proprietorship - Strengths
• Easy to start!• Relatively easy to manage!• You don’t have to share!• You don’t have to pay business income
taxes!• It feels good to be your own boss!• When you want to quit, you can just quit!
Sole Proprietorship - Weaknesses
• UNLIMITED LIABILITY!!!!• Tough to get that money!• Size• How do I run this thing again?•Why doesn’t anyone want to work for
me?
Partnerships
•What is it?•Are they profitable?•Are there different types?
Partnership –Formation
•Seems like it’d be easy to start… I think?•There’s probably some legal mumbo jumbo involved I bet.
Partnership- Ask Yourself
•Who is involved with your company?• How is the deal going to be drawn up?• How will decision be made?•What is your business going to sell?•Who is your business going to target?
Partnership – Strengths
• Similar to Sole Proprietorships• Yeah but what are the differences? I’m
sure there are some right?
Partnership - Weaknesses
•Who’s in charge here?• Limited Partnership = Limited
Liability
• Ugh! I can’t stand that guy!
Corporations
• I bet there is a bunch of those!•What exactly is it?
Corporations – Formation
• Seems like a suit and tie kind of thing• Incorporate•What’s that stock thing all about?
Corporations – Structure
•Who owns the company?•Can I? That’s a pretty big
commitment…•Where does stock play in?
Corporations – Ask Yourself
• CEO – Mr. Elder• Stock Holders – Each of you has
purchased one share of stock guess who has the other 50 percent of shares!• Elect a Board of Directors (3 people)• Now what happens?
Corporations – Strengths
• Super Easy to Raise Capital• We want winners!• LIMITED LIABILITY• We’ll be around forever, and ever, and
ever, and ever…
Corporations- Weaknesses
• Hope you have boat loads of cash!• Can you hear me now?• Ugh taxes!• That government is always steppin’ on
my toes!