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Questions and Answers
What is the primary purpose of a business plan?
What is the primary purpose of a business plan?
What is a major disadvantage of franchise ownership?
What is a major disadvantage of franchise ownership?
What is a characteristic of a sole proprietorship?
What is a characteristic of a sole proprietorship?
What is a type of partnership where limited partners have limited liability and no management control?
What is a type of partnership where limited partners have limited liability and no management control?
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What is an advantage of a corporation?
What is an advantage of a corporation?
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What is the purpose of mediation in dispute resolution?
What is the purpose of mediation in dispute resolution?
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What is the typical punishment for a misdemeanor?
What is the typical punishment for a misdemeanor?
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What are the elements of negligence?
What are the elements of negligence?
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Who is the party that brings a lawsuit against another party?
Who is the party that brings a lawsuit against another party?
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What is the term for unfair persuasion or pressure exerted by one party over another?
What is the term for unfair persuasion or pressure exerted by one party over another?
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Study Notes
Entrepreneurship
Business Planning
- A written document outlining business goals, strategies, and financial projections
- Essential for entrepreneurs to clarify business ideas, identify opportunities, and make informed decisions
- Typically includes:
- Executive summary
- Company description
- Market analysis
- Product/service description
- Marketing and sales strategy
- Financial projections (income statement, balance sheet, cash flow statement)
Franchise Ownership
- A business model where an individual (franchisee) purchases the right to operate a business using the trademark, products, and business system of another company (franchisor)
- Advantages:
- Established brand recognition
- Ongoing support and training
- Access to proven business systems and operations
- Disadvantages:
- Initial investment and ongoing fees
- Limited control over business operations
- Dependence on the franchisor's reputation and success
Business Structures
Sole Proprietorship
- A business owned and operated by one individual
- Advantages:
- Easy to establish and maintain
- Complete control over business operations
- Minimal legal and regulatory requirements
- Disadvantages:
- Unlimited personal liability
- Limited access to capital and resources
Partnership
- A business owned and operated by two or more individuals
- Types:
- General partnership: all partners have equal responsibility and liability
- Limited partnership: limited partners have limited liability and no management control
- Advantages:
- Shared decision-making and risk
- Access to diverse skills and expertise
- Flexibility in management and operation
- Disadvantages:
- Unlimited personal liability (general partners)
- Potential for conflicts and disagreements
Corporation
- A separate legal entity owned by shareholders
- Advantages:
- Limited liability for shareholders
- Access to capital through stock issuance
- Perpetual existence
- Disadvantages:
- Complex and costly to establish and maintain
- Double taxation (corporate and shareholder taxes)
Legal Concepts
Mediation
- A dispute resolution process where a neutral third party facilitates negotiation between parties
- Advantages:
- Confidential and informal
- Flexible and adaptable
- Cost-effective and efficient
Misdemeanor
- A criminal offense punishable by fine or imprisonment for less than one year
- Examples: traffic violations, disorderly conduct, petty theft
Negligence
- Failure to exercise the care that a reasonably prudent person would exercise in a similar situation
- Elements:
- Duty of care
- Breach of duty
- Causation
- Damages
Plaintiff
- A person or entity that brings a lawsuit against another party
- Responsibilities:
- Filing a complaint
- Proving the case
- Seeking damages or relief
Tort
- A civil wrong or injury committed by one party against another
- Examples: negligence, intentional torts, strict liability
Undue Influence
- Unfair persuasion or pressure exerted by one party over another, often in contract or business dealings
- Elements:
- Vulnerability of the influenced party
- Unfair persuasion or pressure
- Unjust result
Verdict
- A jury's decision in a trial, usually involving a finding of guilt or innocence
- Types:
- Guilty verdict: defendant is found guilty of the charged offense
- Not guilty verdict: defendant is acquitted of the charged offense
- Hung jury verdict: jury is unable to reach a unanimous decision
Business Planning
- A written document outlining business goals, strategies, and financial projections
- Essential for entrepreneurs to clarify business ideas, identify opportunities, and make informed decisions
- Typically includes: executive summary, company description, market analysis, product/service description, marketing and sales strategy, and financial projections
Franchise Ownership
- A business model where an individual (franchisee) purchases the right to operate a business using the trademark, products, and business system of another company (franchisor)
- Advantages: established brand recognition, ongoing support and training, and access to proven business systems and operations
- Disadvantages: initial investment and ongoing fees, limited control over business operations, and dependence on the franchisor's reputation and success
Business Structures
Sole Proprietorship
- A business owned and operated by one individual
- Advantages: easy to establish and maintain, complete control over business operations, and minimal legal and regulatory requirements
- Disadvantages: unlimited personal liability, limited access to capital and resources
Partnership
- A business owned and operated by two or more individuals
- Types: general partnership (all partners have equal responsibility and liability), limited partnership (limited partners have limited liability and no management control)
- Advantages: shared decision-making and risk, access to diverse skills and expertise, and flexibility in management and operation
- Disadvantages: unlimited personal liability (general partners), potential for conflicts and disagreements
Corporation
- A separate legal entity owned by shareholders
- Advantages: limited liability for shareholders, access to capital through stock issuance, and perpetual existence
- Disadvantages: complex and costly to establish and maintain, double taxation (corporate and shareholder taxes)
Legal Concepts
Mediation
- A dispute resolution process where a neutral third party facilitates negotiation between parties
- Advantages: confidential and informal, flexible and adaptable, and cost-effective and efficient
Misdemeanor
- A criminal offense punishable by fine or imprisonment for less than one year
- Examples: traffic violations, disorderly conduct, petty theft
Negligence
- Failure to exercise the care that a reasonably prudent person would exercise in a similar situation
- Elements: duty of care, breach of duty, causation, and damages
Plaintiff
- A person or entity that brings a lawsuit against another party
- Responsibilities: filing a complaint, proving the case, and seeking damages or relief
Tort
- A civil wrong or injury committed by one party against another
- Examples: negligence, intentional torts, strict liability
Undue Influence
- Unfair persuasion or pressure exerted by one party over another, often in contract or business dealings
- Elements: vulnerability of the influenced party, unfair persuasion or pressure, and unjust result
Verdict
- A jury's decision in a trial, usually involving a finding of guilt or innocence
- Types: guilty verdict, not guilty verdict, hung jury verdict
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Description
Test your knowledge of entrepreneurship, business planning, and franchise ownership. Learn about essential business documents and strategies.
