Pob Sba Essay

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Answers to exam-style questions Please note that these are not the only possible answers. Most CSEC ® Principles of Business examination questions can be answered in many ways, using a variety of different examples. 1. The nature of business 1. a Two advantages of doing business as a sole trader are:(Choose any two) zz zz the globe. They specialize in related activities, for example energy production or banking. Conglomerates are large companies which own a variety of businesses producing different goods or services. c Multinational corporations:- Bank of Nova Scotia; British Petroleum (BP); Alcoa Conglomerates:- Neal and Massy Ltd.; Ansa McCall; Grace Kennedy Ltd. d Two benefits of a franchise for an individual starting a business are:zz zz zz Easy to establish and manage. Decision-making is speedy, since sole traders own and operate their own businesses. Customers receive special attention. Profits are not shared. Two disadvantages of doing business as a sole trader are:(Choose any two) zz zz zz zz zz zz Unlimited liability, that is, all losses and debts incurred by the business must be borne by the owner. Problems in raising capital. Limited managerial skills. Lack of competitiveness. (Discounts, if offered to the sole trader may be small in comparison to big business operations). Lack of continuity, if the owner dies, the business also dies. Long working hours. zz the entrepreneur enjoys the goodwill associated with the franchise and can use an international brand name. there are fewer risks involved than in starting a new business (e.g. in developing markets for products etc.). Two disadvantages of a franchise for an individual starting a business are:zz b Multinational corporations are giant international firms, which operate from their corporate headquarters in their home countries, but conduct their business

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