Forms of business ownership
A sole trader owns and runs the business alone, keeping full control and profit but bearing unlimited liability. A partnership is owned by two or more people sharing capital, management, and liability. A cooperative society is owned and democratically controlled by its members (often producers or consumers), who pool resources for shared benefit, with profits typically distributed based on members' participation rather than shares owned. A limited liability company is owned by shareholders, whose liability is limited to their investment.
Example 1: Explain one key difference between a cooperative society and a limited liability company.
A cooperative society is run democratically -- typically one member, one vote, regardless of how much each member has contributed -- and profits are usually shared based on participation (e.g. purchases made or produce supplied). A limited liability company gives voting power and profit share in proportion to shares owned, so larger shareholders have proportionally more influence and reward.
Functions of management
Management involves four core functions: planning (setting goals and deciding how to achieve them), organizing (arranging resources and people to carry out the plan), directing (leading and motivating staff to perform), and controlling (monitoring performance against goals and correcting deviations).