| A | B |
|---|
| entrepreneur | a person who starts a business despite the risks involved |
| 4 elements of business operation | expenses, advertising, receipts and record keeping, risk |
| start up | costs involved in beginning a business |
| advertising | important for new businesses to allert customers to the businesses existence |
| inventory | supply of materials used by business |
| profit incentive | reason an entrepreneur is willing to take the risk of starting a business |
| sole proprietorship | business owned by one person |
| small business incubator | assists small businesses by providing low-rent buildings, management advice, etc. |
| partnership | business with two or more owners/operators |
| limited partnership | general partner assumes all management duties and has full responsibility for debts. Other partner(s) only contributes money and has no say in running of business |
| joint ventures | companies joining together for ONLY a specific project |
| proprietor | owner of a business |
| most common type of business organization | sole proprietorships |
| unlimited liability | owner has complete legal responsibility for all debts and damages brough upon by doing business |
| corporation | organization owned by many people but treated by the law as though it were a person |
| limited liability | only the business can be sued, not individual owners of the business |
| corporate charter | license to operate from the state |
| perferred stock | guarantees a certain amount of dividend each year |
| stockholders | owners of a corporation |
| franchise | individual buys the right to use a company's name and sell its products |
| type of business organization that benefits from limited liability | corporations |
| type of business that can disintergrate due to fights between owners | partnerships |
| type of business that has the longest life expectancy | corporations |
