sole trader quiz

What is a sole trader?

• A type of partnership

• A business owned and run by one person

• A public limited company

• A business owned and run by multiple people

Which of the following is an example of a sole trader's business?

• A government agency

• A local bakery

• A multinational corporation

• A public school

What is unlimited liability?

• When the business owner is personally responsible for all the business's debts

• When a business has no financial obligations

• When a business can borrow unlimited funds

• When a business's financial obligations are limited to its assets

What tax does a sole trader pay on their earnings?

• Property tax

• Income tax

• Corporate tax

• Sales tax

Which of the following is an advantage of being a sole trader?

• Limited control over the business

• Opportunity to be your own boss

• High set-up costs

• Limited liability

Which of the following is a disadvantage of being a sole trader?

• Less paperwork

• Low set-up costs

• Quick and easy to set up

• High level of responsibility

What might a sole trader experience due to the nature of their business?

• Short work hours

• Less stress

• Long work hours and stressful conditions

• No responsibility

Which role does a sole trader often perform in their business?

• Only the managerial roles

• Only the financial roles

• Many different roles

• Only the customer service roles

How does a sole trader typically finance their business?

• Through government grants only

• By reinvesting profits and personal savings

• Issuing shares to the public

• Through crowdfunding platforms exclusively

Which statement best describes the decision-making process in a sole trader business?

• Decisions are made by a board of directors

• Decisions are made after a public vote

• Decisions are made solely by the owner

• Decisions require approval from all employees