Business Ownership Quiz

What is a primary advantage of a sole proprietorship?

• Limited liability

• Easy to transfer ownership

• Complete control by the owner

• Ability to raise capital easily

Which business structure offers limited liability protection to all partners?

• Sole Proprietorship

• General Partnership

• Limited Liability Partnership (LLP)

• Cooperative

In a franchise business model, who provides the business system and brand recognition?

• Franchisee

• Franchisor

• General Partner

• Limited Partner

What is a disadvantage of running a sole proprietorship?

• Difficulty in obtaining financing

• Limited legal requirements

• Shared decision-making

• High level of liability protection

Which type of business ownership is best for two doctors wanting to open a clinic together?

• Sole Proprietorship

• General Partnership

• Limited Liability Partnership (LLP)

• Corporation

What is a characteristic of a Limited Liability Company (LLC)?

• Owners are taxed separately from the business

• Unlimited number of members

• Must have at least one general partner

• Partners cannot participate in management

Which of the following is a feature of a C-corporation?

• Pass-through taxation

• Shareholders are personally liable for debts

• Double taxation

• Limited to 100 shareholders

What is a general partner responsible for in a Limited Partnership (LP)?

• Providing capital only

• Day-to-day management

• Silent partnership

• Limited liability

In a Limited Liability Partnership (LLP), each partner's liability is limited to what?

• The actions of other partners

• The amount they invested

• Unlimited liability

• The number of clients they serve

Which of the following is an example of a business that typically uses an LLP?

• Fast-food restaurant

• Medical practice

• Landscaping business

• E-commerce store