ch.8 Business Organizations

Conglomerate

A business combination merging more than three businesses that produce unrelated products or services.

Cooperative

A business organization owned and operated by a group of individuals for their shared benefit.

Stock

A certificate of ownership in a corporation.

Bond

A formal contract issued by a corporation or other entity that includes a promise to repay borrowed money with interest at fixed intervals.

Business Association

A group organized to promote the collective business interests of an area or group of similar businesses.

Multinational Corporation

A large corporation that produces and sells its goods and services in more than one country.

Corporation

A legal entity, or being, owned by individual stockholders, each of whom has limited liability for the firm's debt.

Certificate of Incorporation

A license to form a corporation issued by a state government.

Professional Organization

A nonprofit organization that works to improve the image, working conditions, and skill levels of people in particular occupations.

Articles of Partnership

A partnership agreement that spells out each partner's rights and responsibilities.

Consumer Cooperative

A retail outlet owned and operated by consumers that sells merchandise to members at reduced prices.

Business Franchise

A semi-independent business that pays fees to a parent company in return for the exclusive right to sell a certain product or service in a given area.

Limited Liability Corporation

A type of business with limited liability for the owners, with the advantage of not paying corporate income tax.

Service Cooperative

A type of cooperative that provides a service rather than a good.

Closely Held Corporation

A type of corporation that issues stock to only a few people, who are often family members.

Publicly Held Corporation

A type of corporation that sells stock on the open market.

Limited Liability Partnership

A type of partnership in which all partners are limited partners.

Producer cooperative

An agricultural marketing cooperative that helps members sell their products.

Nonprofit Organization

An institution that functions much like a business, but does not operate for the purpose of generating profit.

Trade Association

Nonprofit organizations that promote the interests of particular industries.

Horizontal Merger

The combination of two or more firms competing in the same market with the same good or service.

Assets

The money and other valuables belonging to an individual or business.

Dividend

The portion of corporate profits paid out to stockholders.

Royalties

The share of earnings given by a franchise as payment to the franchiser.

Vertical Merger

Two or more firms involved in different stages of producing the same good or service.

Limited Partnership

a type of partnership in which only one partner is required to be a general partner.

Business License

authorization to operate a business issued by a local government.

Zoning Laws

laws in a city or town that designate certain areas, or zones, for residential and business use.

Fringe Benefits

payments to employees other than wages or salary.

Liability

the legal obligation to pay debts

Business Organization

the ownership structure of a company or firm.

Partnership

a business organization owned by two or more persons who agree on a specific division of responsibilities and liability.

Sole Proprietorship

a business owned and managed by a single individual.