Business Ownership and Liability Quiz
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Questions and Answers

What is the primary purpose of a business?

  • To accumulate personal possessions
  • To provide goods and services for free
  • To avoid taxation
  • To make a living or earn money through production or trade (correct)

    • How does having a business name affect the owner's liability?

  • It exempts the owner from personal taxation
  • It limits the owner's liability to business profits
  • It completely absolves the owner from any business-related liabilities
  • It does not separate the business entity from the owner, making the owner responsible for business debts (correct)

    • How are businesses and corporations taxed differently?

  • Businesses and corporations are taxed at the same rate
  • Corporations are personally taxed, while businesses have separate tax rates
  • Businesses enjoy tax exemptions, while corporations are heavily taxed
  • Businesses are personally taxed on all income, while corporations have separate tax rates (correct)

    • What distinguishes corporations from sole proprietors and partnerships?

    <p>Corporations are separate legal entities and provide limited liability for their owners/members</p> Signup and view all the answers

    How is business colloquially used to refer to a company?

    <p>As a corporation or cooperative</p> Signup and view all the answers

    What is the primary purpose of a business?

    <p>To make a living by producing and selling products</p> Signup and view all the answers

    How does having a business name affect the owner's liability?

    <p>The owner is responsible and liable for debts incurred by the business</p> Signup and view all the answers

    How are businesses and corporations taxed differently?

    <p>Business structure does not allow for corporate tax rates</p> Signup and view all the answers

    What distinguishes corporations from sole proprietors and partnerships?

    <p>Corporations provide limited liability for their owners/members</p> Signup and view all the answers

    How is business colloquially used to refer to a company?

    <p>To refer to a company, such as a corporation or cooperative</p> Signup and view all the answers

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