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Types Of Business.

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Introduction

Types Of Business Businesses can be divided into 3 sectors, the private, public and voluntary sector. The voluntary sector covers organisations such as charities and businesses that do not make a profit. People who work for these organisations do not get paid for their work although they do have a total annual income of over �15bn. �4bn of this money comes from private donations, fundraising and charity shops. This money is then used by the charity for things such as medical research. The private sector divides into 3 further parts. These are: * The personal sector * The corporate sector * The financial sector The personal sector makes economic decisions and finds out information about individuals and households such as how much income people earn, how they spend their money and how much they save. All this information directly affects the economy as it generates demand for goods and services. The corporate sector includes businesses privately owned. Almost all businesses are in the private sector except for charities. Finally, the financial sector deals with the financial side of things. This includes financial institutions such as banks and some building societies. Their role is to make and receive payments on behalf of customers as well as acting as the link between those groups that have the money to save and those that need to borrow. Private sector businesses are said to be 'Privatised'. The public sector therefore, covers activities that are carried out and owned by local and central government such as schools and sports centres. ...read more.

Middle

They are called public companies because they are owned by shareholders as the shares can be traded on the Stock Exchange. By selling the shares, the company can raise large amounts of capital very quickly. Deciding to sell shares on the Stock Exchange can be quite risky as it is quite expensive to 'float' in the first place and the Exchange can have many good and bad days. If new shares become available on a bad day, when many people want to sell, the company can find itself in difficulties. The shareholders have limited liability, so they can only lose whatever they have invested into the company. Another advantage is that when a shareholder decides to discontinue his investment they can sell their shares on to someone else while the company still has the money permanently. A public company may have thousands of shareholders and it is these shareholders who elect a board of directors to look after their interests. The board can then appoint specialists in a certain field for their expertise if they wish. A major disadvantage of PLC is that control of the business can be lost by the original shareholders if lots of shares are bought by one individual or consortium as part of a take-over bid. Other disadvantages are that many criteria and legal requirements must be met in order to set up and accounts and financial records must be made public. A PLC must also hold an AGM (Annual General Meeting) ...read more.

Conclusion

In companies, there are no owners to take the profits, the shareholders just make money by selling their shares at the right time. There are also more legal requirements in a company. Should a problem arise, they have the resources to pay specialist legal teams to sort it out. In smaller companies, there is less paperwork and they do not have the time or money to employ specialists and should there be a problem, the owner is held personally responsible. My Company The company that I am going to investigate is ChevronTexaco, a company set up in 2001 as a result of a merger between Chevron and Texaco, two major oil companies, to create one of the worlds largest energy companies. The company refines crude oil into all kinds of fuels and chemicals such as aviation fuel, lubricants, chemicals, marine fuels and more commonly, motor fuels. They have their headquarters in Texas and held their AGM on May 22nd 2003. The company is a Public Limited Company, so that means the general public can buy shares in the company. Directors are elected by the shareholders and a board is appointed to look after the interests of the shareholders and to oversee operations within the company, such as its business affairs and its policy. Applicants to the board need to have the appropriate skills and experience before they are appointed. This is the current ChevronTexaco share price taken from the New York Stock Exchange on Tuesday 1st October. ...read more.

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