Sole Proprietorships and Partnerships Quiz

Sole Proprietorships and Partnerships

• Sole proprietorships account for 40% of U.S. businesses.
• An advantage of a sole proprietorship is that the owner has no income tax.
• An advantage of a partnership is continuity; the partnership can survive if a partner dies.
• Mergers in a partnership are typically easy to complete
• Company decisions are sometimes shared, which can create friction and lead to problems.

Opioid Crisis

• The addiction stemming from misuse of opioids (including OxyContin, heroin, and fentanyl) is a national crisis.
• A person today is more likely to die from an opioid overdose than a car crash.
• Factors partly to blame for the opioid crisis include pharmaceutical representatives failing to educate physicians about opioid risk and telling them opioids are not addictive.
• Physicians and other medical professionals over-prescribing opioids are also contributing factors.
• The Federal Bureau of Investigation is not a factor in this crisis.

Ethical Dilemmas and Leadership

• An ethical dilemma/decision involves choosing between two or more unacceptable options.
• A right vs. right decision is a type of ethical dilemma.
• A right vs. wrong decision involves a choice between a right and a wrong action.
• Leaders should promote ethical behavior in organizations by encouraging employees to report ethical violations.
• Leaders should establish controls to enforce company policies and be ethical role models.

Corporate Social Responsibility

• Corporate social responsibility (CSR) is the approach that businesses use to balance their responsibilities towards various stakeholders.
• Stakeholders include suppliers, communities, and employees.
• Competitors are not a stakeholder in the approach.

Climate Change Impact on Businesses

• Businesses are impacted by harsher working conditions, such as extreme heat.
• Difficulty encouraging talented executives to relocate to areas with improved air quality can also be affected.
• Changing demand for services and products, such as snow shovels, are affected.
• Financial risk from severe weather events is another serious business impact.

Legal Systems in the U.S.

• The U.S. government is responsible for adopting and enforcing legal rules and principles.
• The legal system evolves to adapt to changes in social norms and commercial activities.
• The U.S. legal system uses the court system to address disputes.
• The legislative and executive branches play respective roles in the legal system.
• The primary function of U.S. law is to maintain peace, as one of several important functions.

Management and Business Decisions

• Management is the process of planning, organizing, directing, and controlling resources to meet goals.
• Managers should ensure tasks contribute to organizational success.

Leadership Styles

• Laissez-faire leadership is a leadership style where decisions are made without input from those involved, and they are expected to perform tasks without undue explanation.
• In a visionary leadership style, team members are encouraged to come up with new ideas.
• Autocratic leadership involves a one-way decision-making process without team participation.
• A democratic leadership style involves team participation in decisions.

Business Performance Evaluation

• Standard performance is a measurement of expected performance.
• Actual performance is the real performance against the benchmark of standard performance.
• Deviation is the gap between expected performance and actual performance.

Job Satisfaction and Motivation

• Technical, conceptual, interpersonal, and decision-making skills are key factors for job success.
• Motivation is a key factor for job satisfaction when hygiene factors and equity are considered.
• Benefits that are outside salaries, wages or financial incentives are also a form of satisfaction.

Performance Reviews and Appraisals

• Three-step appraisal system involves completing a written evaluation of employee performance with predetermined criteria, and sharing the results. Goals and expectations are also set, as well as meeting the employee to discuss the evaluation.

Team Success Factors

• Team members willing to commit to common goals are crucial for team success.
• Groupthink, a lack of an adequate budget, lack of collaboration, and poor leadership are obstacles to effective teamwork.
• Members who tolerate each other, and those who agree to disagree are traits of an effective team.
• Leaders who rotate positions infrequently and team members who depend on each other also support good teamwork.
• Cross-functional teams bring together individuals from different parts of an organization.

Forecasting Demand

• Forecasting demand for products may use several strategies like speaking with customers and/or competitors, and reviewing industry data on the internet.

Financial Planning

• To plan for finances, understand your: debt, expected income in retirement, and current annual income. Some considerations might include leasing versus purchasing.

Monetary Assets

• Bonds, cash, certificates of deposits, and money in checking accounts are considered liquid assets.
• A budget is a document that itemizes income, expenditures, and relevant monetary amounts.

Product Characterization

• Physical goods are tangible items. Services are intangible offerings.
• A "purple cow" is a product that is remarkable.
• An idea becomes a business opportunity when it has commercial potential.
• Niche markets are the smallest divisions of customers.

Test your knowledge on the characteristics and advantages of sole proprietorships and partnerships. Explore how these business structures impact decision-making, continuity, and taxation. Perfect for students studying business or entrepreneurship!