16 Questions
What is an advantage of sole proprietorship?
Proprietors have complete control over the business
What should a business owner carefully assess?
The way the business is formed and structured
What type of companies are typically owned by one person in a hands-on management role?
Sole Proprietorship
What is a disadvantage of sole proprietorship?
Proprietors have unlimited liability
What do sole proprietors own in their business?
The entire business, including all assets and profits
What are assets in the context of business ownership?
Resources with economic value that are owned and controlled by the business owners
What is a potential disadvantage of obtaining additional capital for a partnership?
Low guarantee of profitable returns to lenders
In a general partnership, how are profits and losses typically shared?
Both profits and losses are shared
What is a key characteristic of a limited partnership?
Must have at least two general partners
What does the text identify as an advantage of a corporation?
Wider capital base
Why might highly skilled employees be hesitant to work in a partnership?
Low chance to advance in their careers
What makes expansion easier in a limited partnership?
More people managing different branches
What is a potential disadvantage of partnerships?
Partners are jointly liable for all obligations and effects
What distinguishes a limited partnership from a general partnership?
At least one general partner and one limited partner required
What is one reason why expansion is easier in a limited partnership?
More people involved in managing different branches
Why might obtaining additional capital be difficult for partnerships?
Low guarantee of profitable returns to lenders
Test your knowledge about business organization assessment, including considerations like size, control, profit, tax implications, and vulnerability to lawsuits, which determine the type of business organization. This quiz covers the advantages and factors to consider when forming and structuring a business.
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