Incentives, Entreprenuership, and Types of Businesses

Corporation

Business is considered an entity by law, owned by stockholders, and has limited liability in terms of personal assets, continuity of life, centralization of management and the ability to transfer ownership of interests.

C Corporation

Form of ownership structure that provides limited liability, but suffers from double taxation and does not enable losses to flow through to investors for current use.

strength, weakness, opportunities, threats

SWOT

Incentive

Something that makes a person take a certain action

Consumer sovereignty

The power of consumers to decide what gets produced

Entrepreneurship

The process of starting a new business

Shares

Units of ownership in a corporation

Control, Profit, Pride

What are some benefits of becoming an entrepreneur?

Money loss, stress, time, problems

What are some risks and drawbacks of becoming an entrepreneur?

to evaluate risks and opportunities

What is SWOT used for?

Conglomerate

a corporation that conducts business in at least two different industries

LLC (Limited liability company)

a cross between the limited liability feature of a corporation and the taxation and operational features of a partnership.

Franchise

an arrangement in which an established company sells the right for others to use the company's name and operation plan to sell products or services

Sole proprietorship

business owned by a single individual

Cooperative

business owned, controlled and operated for the mutual benefit of its members

LLC (limited liability)

means that a business owner can NOT be legally forced to use personal money and possessions to pay the debts of the business.

ULC (unlimited liability)

means that a business owner can be legally forced to use personal money and possessions to pay the debts of the business.

"Invisible hand"

the competition that having incentives creates

observe, listen, think

three ways to think like an entrepreneur?

general partnership

two or more people contributing to a business, all profits and losses are shared.

major topic in "wealth of nations"

without controls or regulators a free market economy would not be viable

S Corporation

A close business corporation that has met certain requirements set out in the Internal Revenue Code and thus qualifies for special income tax treatment. Essentially, it is taxed the same as a partnership, but its owners enjoy the privilege of limited liability.