Different business types

What is the simplest and most common structure chosen to start a business?

• Sole Proprietorship

• Limited Liability Company

• Partnership

• Corporation

In a general partnership, how are liabilities and responsibilities handled?

• Only the limited partners are responsible

• Only the general partner is responsible

• All partners have equal responsibility

• Responsibilities are divided based on investment

What distinguishes a limited partnership from a general partnership?

• One partner is a general partner and at least one is a limited partner

• It has only one owner

• All partners have limited liability

• It cannot incur debts

What is a key feature of a Limited Liability Partnership (LLP)?

• All of the owners have limited personal liability

• Only one partner has limited liability

• All partners have unlimited personal liability

• It is owned by shareholders

Who elects the board of directors in a corporation?

• The government

• The CEO

• The shareholders

• The employees

What is a unique feature of a Limited Liability Company (LLC)?

• It cannot have employees

• It is owned by a single individual

• Owners are personally responsible for debts

• Owners have protection from business failure

What is a franchise?

• A partnership with limited liability

• A type of corporation

• An authorization to carry out specific commercial activities

• A sole proprietorship with multiple locations

How is a privately held corporation different from a publicly held corporation?

• It does not have shareholders

• It cannot have a board of directors

• It is not allowed to make profits

• Shares are not traded on a public stock exchange

What happens if an LLC is forced into bankruptcy?

• The government pays off the LLC's debts

• Members are not required to pay the debts with their own money

• Creditors can claim the personal assets of the members

• Members must pay the debts with their own money

Which type of business structure allows for the separation of personal liability from the business?

• Sole Proprietorship

• General Partnership

• Corporation

• Franchise