Unit 5 Test (Business Organizations)

Which of the following is an advantage of sole proprietorship?

• There are almost no requirements to start up a sole proprietorship.

• The owner keeps all the profits.

• The owner makes all the decisions.

• All of the above statements are true.

Which of the following is a disadvantage of sole proprietorship?

• They're hard to start up

• Personal property is protected under bankruptcy

• The owner takes all the liability

• The owner doesn't get to keep all the profits

Lack of permanence applies to ______ .

• corporations

• sole proprietorships

• nonprofit organizations

• multinationals

According to figure 8.1, the type of organization with the most sales in the United States is?

• Corporations

• Partnerships

• Sole Proprietorships

• Franchises

a business owned and managed by a single individual

• Sole Proprietorship

• Partnership

• Corporation

• Franchise

a business organization owned by two or more persons who agree on specific division of responsibilities and profits

• Sole Proprietorship

• Partnership

• Corporation

• Franchise

a legal entity, or being, owned by individual stockholders, each of whom has limited liability for the firms debts

• Sole Proprietorship

• Partnership

• Corporation

• Franchise

a semi-independent business that pays fees to a parent company in return for the exclusive right to sell a certain product or service in a given area

• Sole Proprietorship

• Partnership

• Corporation

• Franchise

Payments to the parent company from the franchiser

• Franchise Fee

• Royalties

• Payment Agreement

• Operations Agreement

a certificate of ownership in a corporation

• Stock

• Bond

• Share