NAME: CHARIBELLE A. AVILA Yr.

& Sec: BPA-3A

LESSON 2 ACTIVITIES

I- Definition of Terms. Define the following terms based on the topics discussed in the
learning material.

1. Owner – Business owners are people who hold legal ownership of the company.
Owners might be a single person who starts and operates a small business, partners
who own the company together, individual investors who acquire shares in a
corporation, or other groups. These individuals have a vested interest in the company
and are concerned with its management.

2. Board of Directors - A corporate board of directors is elected by the stockholders

and is tasked with supervising the overall administration of the company to ensure that it
is managed in the best interests of the owners. Some boards are relatively inactive.
They provide general supervision but are rarely directly involved in how the firm is
managed. However, this tendency is changing as more and more boards are closely
investigating the companies they supervise and exercising more control over how they
are handled.

3. Employees - are a significant component of an organization's internal environment.

Employees are the workers who carry out the organization's day-to-day operations and
ensure that work is completed in order to achieve the organization's desired goals. The
managers of an organization supervise and manage these groups of individuals.
Managers are responsible for integrating and managing an organization's resources,
including personnel, to ensure that the organization's goals are met.

4. Suppliers - are persons and businesses who provide an organization with the input
resources it requires to create goods and services (such as raw materials, component
components, or staff). In exchange, the provider is compensated for the goods and
services provided. A critical part of a manager's duty is to maintain a consistent flow of
input resources. An organization may require some resources, putting it in a position
where it is heavily reliant on the providers of those resources, some of whom operate in
highly organized marketplaces.
5. Distributors - are companies that assist other businesses in selling their products or
services to clients. Managers' decisions on how to provide items to clients can have a
significant impact on organizational success. Managers may face both opportunities and
challenges when distributors and distribution systems evolve. If distributors grow large
and strong enough to restrict customers' access to a certain company's goods and
services, they might threaten the organization by demanding that its goods and services
be reduced in price.

6. Customer - Individuals and groups who purchase an organization's goods and

services are referred to as customers. A client might be an individual, a business, a
school, a hospital, or another organization or a government body. Customers are critical
to the success of any business. The capacity to recognize and satisfy the requirements
of consumers is the most important factor in an organization's survival and profitability.
Customers are frequently seen as the most important stakeholder group because if a
firm can entice them to purchase its products, it will be able to continue in business for a
long time. Organizations must strive to satisfy existing consumers while attracting new
ones.

7. Competitors - are businesses that produce identical goods and services to a

company. In other words, rivals are businesses that compete for the same clients. Dell's
competitors include Apple, Compaq, Sony, and Toshiba, among others. Globe Telecom
competes with other communication businesses in the Philippines, such as Smart and
PLDT. Direct and indirect competition is an essential aspect of the environment in which
companies compete. Firms' market share and overall success are affected by how they
respond to competitive factors. Competitor rivalry is perhaps the most dangerous factor
that businesses must cope with. Price competition is common when there is a high
amount of competitiveness, and falling prices restrict access to resources and lower
earnings.

8. Internal Environment - This category includes the forces that have an impact on a
firm as a distinct entity. It is also known as the internal working system or organizational
climate, and it is made up of people functions and structures that are typically viewed as
controllable environmental variables.
9. Task Environment - Customers, financial institution providers, labor organizations,
government agencies, and local communities comprise the immediate external
environment.

10. Indirect Environment - These are the forces that have an impact on a business as
well as other business organizations. They are as follows: Socio-Cultural Variables
which is the way of life of the people, Technological Environment comprises the
innovations and improvements in methods, machine and materials, Economic
Environment is the general pattern of the economy can be viewed from three
dimensions: the economic system, the general business cycle and the economic
policies, Political Legal Environment primarily concerned with complex laws, regulations
and government agencies and their actions which affect all kinds of enterprises in
varying degrees, Physical Environment involves the availability of land, nature of
climate, weather conditions, mineral resources, water and infrastructural facilities, and
International Environment this is the environment of the foreign countries. It consists of
the socio-cultural, political, economic and technological environment of countries where
a business operates

II- A. Differentiate the following based on their feature.

Sole Proprietorship Partnership

1) Ownership/ Membership
2) Capital/Source of fund.
3) Liability
A sole trader as the name It is formed by between 2-
implies is owned by one 10 people and between 2-
person. 10 people in case of banks.
The capital outlay is
provided by the owner. The initial capital is
This source of fund could contributed by partners.
be through personal saving,
intended capital, credit,
borrowing from relatives or
banks etc.
The liability of the one man
business is unlimited. If the Their liability is unlimited
owner is indebted, both the except for limited partner.
business asset and his
personal asset can be sold
to offset the debt.
4) Methods of Withdrawing
Capital
5) Motives in Formation
The owner can withdraw his
capital anytime from the
business without consulting
with anybody.
It is believed that a sole
trader is into business to
make profit.
Method of withdrawing
capital must be approved
by other partners as laid
down in their partnership
deed.
They are formed for profit
reasons.

B. Differentiate the following based on their feature.

Private Company Public Company

1) Membership A minimum of 2 and a Minimum of seven and no

2) Issuance of Share
3) Transferability of Share
4) Quotation
5) Publication of Accounts
maximum of 50.
Cannot sell shares to the
public.
can only be transferred with
the consent of
other shareholders
Private companies are not
quoted on the floor of the
stock exchange.
Not required to publish
annual account.
However they must send a
copy of their audited
account to the registrar of
companies each year.
maximum, but article of
association could specify
maximum.
can sell share to the public
Shares can be transferred
without the consent of other
shareholders.
Are quoted on the floor of
the stock exchange.
Required by law to publish
account and to also send a
copy of audited account to
the registrar of companies
each year.

III- Discussions. Answer and Expound the following questions.

1.) Explain the role of Business in relation to economy.

Answer: Businesses provide jobs while producing goods and services that we rely on in
our daily lives. Businesses are required by law to pay taxes to the government in order
to operate. This indicates that the business sector is critical to the economy. Business
facilitates the creation, manufacturing, and delivery of goods and services to those in
need (customers). This is done with the intention of profiting. People can fend for
themselves in business by concentrating on a particular product or developing
expertise. Clients, distributors, and suppliers gain from business as well. Business
contributes to the development of new goods and services, as well as the provision of
goods and services that customers may be unable to produce.

2.) Why is it important to know about the environmental factors surrounding the
organization/business? What is the value of environmental scanning?

Answer: It is important to know about the environmental factors surrounding the

organization/business to ensure the smooth operation of their business cycles; business
managers must study business environmental factors such as changes in input
supplies, changes in social factors such as consumer behavior, state of competition in
industry, and so on. It is also necessary to take full advantage of opportunities for gain
hidden in the business environment, to avoid legal consequences, to improve
competitiveness and profitability, as well as to better satisfy social duties. The value of
environmental scanning is to assist organizations in identifying early warning signs of
possible environmental changes. It is also part of strategic planning since it provides
information on issues that will have an impact on the firm in the future. Leadership will
be able to respond to external forces in a proactive manner as a result of the
information gained.

3.) How does Government benefit from businesses?

Answer: The primary benefit that the government derives from business is taxation.
Businesses pay a variety of taxes to the government, which allows the government to
deliver additional services to the general population.