av Jason Loren för 6 årar sedan
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Governments may use these businesses for political reasons
No close competitors
Government subsidies can leas to inefficiency
No private shareholders
Natural monopolies are owned by the government
Government can save the business
Some industries are considered so important that government ownership is thought to be essential
May have different ways of running a business
Disagreements on important decisions may occur
Profits are shared
Local knowledge
Risks are shared
Costs are shares
Owner of the business may lose control
Selling shares to public is expensive
Difficult to control and manage
More regulations
Legal formalities
Easier to attract suppliers
No restriction o selling, transferring or buying shares
Opportunity to raise very large sums of capital
It is an Incorporated business
Limited liability to the shareholders
DIsadvantages
If owner is ill, there will be no one that will be able to take care of the business for him
Likely to remain small
No other owners to help pay for expenses
Unlimited liability
No one to discuss business matters with
Close contact with customers
Does not need to give business information to anyone else ( Except tax office)
incentive to work hard
few legal regulations
Owner has freedom to choose holidays, work hours, whom to employ, etc.
No sharing profits
Owner in complete control
Disadvantages
The shares in a private limited company cannot be sold or transferred without the agreement of all the shareholders
The company cannot offer its shares to the general public
Accounts must be available for the public to see
There are significant legal matters
People who started the company can keep control of the company as long as they don't sell too many shares to too many people
All shareholders have limited liability
Shares can be sold to a large number of people
Disadavantages
Most countries limit the amount of partners to 20
If one partner is contributing less or dishonest, it can effect the other partners
Partners may disagree of business decisions
Business does not have a separate legal identity
Partners did not have limited liability
Advantages
owners will be motivated to work hard because the losses are shared
Responsibilities are shared
More capital
