Business


1. The business sector is where production takes place in the economy. The individual agents making up the business sector are called firms. These are the organizations within which entrepreneurship brings together land, labor and capital for the production of goods or services. Economies, in which firms are generally owned by private individuals, rather than by governments, are called capitalist or private enterprise economies. These include almost all the countries in the world today.

2. A firm may be as small as one individual. A large firm is typically a corporation which is a legal entity in itself, having many of the same rights and privileges under law as does a person. The corporation purchases factors of production and receives payment from buyers of its output. The difference between its sales revenue and its costs of production is its profit or earnings. A corporation purchases capital goods, plant and equipment. The owners of a corporation are


called shareholders. A large firm typically has many shareholders, some of which

are other firms. Firms which primarily invest in other firms are called financial intermediaries. Shareholders play no direct role in the running of the firm, rather they are represented by a board of directors who are elected by shareholders. Shareholders are not liable, in general, for the debts of the corporation.

3. The corporation managers may not even be shareholders. These managers are appointed by the directors as officers of the corporation who are then legally empowered to conduct its business. A primary responsibility of the directors of a corporation is the hiring and oversight of the officers.

Помоги пожалуйста ответить на вопросы.
1. Where does entrepreneurship bring together land, labor and capital?
2. What does a corporation purchase?
3. Do shareholders play a direct role in the running of the firm?