written by Rustam Fayzullayev

📌 Assessment

What is Business?

flowchart TD
    B["Types of business entity"] --> S["Sole trader<br>one owner"]
    B --> P["Partnership<br>two or more partners"]
    B --> L["Limited liability company<br>owned by shareholders"]

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Business is an organisation or economic system where goods and services are exchanged for one another or for money.

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Rus: Бизнес – организация или экономическая система, в которой товары и услуги обмениваются друг на друга или на деньги.

📌 Sole trader – a business owned and run by one individual, perhaps employing one or two assistants.

• (+) The owner has complete control over the business
• (−) The owner is personally liable for all the business's debts (unlimited liability)

📌 Partnership – an arrangement between individuals to carry on business together with a view to profit. It is usually governed by a partnership agreement.

• (+) More capital can be raised, because more people invest
• (−) Partners are jointly and personally liable for all debts (unlimited liability), unless they form an LLP (limited liability partnership)

📌 Limited liability company – a business owned by many people (shareholders) and run by many people, though not necessarily the same ones. The company's debts are legally separate from the owners' personal debts.

• (+) Investing is less risky: if the company fails, shareholders lose only what they paid for their shares, never their personal assets
• (−) The company must publish annual financial statements, so anyone, including competitors, can see how well or badly it is doing

Rus: Индивидуальный предприниматель, партнёрство и общество с ограниченной ответственностью; неограниченная / ограниченная ответственность.

The Goal of a Business: Profit

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Businesses of every size and kind exist to make a profit. Profit is the excess of income over expenditure.

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