Business and Labor

The easiest type of business to start is a sole proprietorship.

• True

• False

Unlimited liability is one of the main advantages of a sole proprietorship.

• True

• False

Partnerships are the most numerous form of business organization in the United States.

• True

• False

Corporations have most of the rights of an individual, according to the law.

• True

• False

If a corporation goes out of business, common stockholders get their investment back before preferred stockholders do.

• True

• False

The government document that grants permission to establish a corporation is called a

• charter.

• stock certificate.

• partnership agreement.

• limited liability agreement.

A business run by a single person is a

• partnership.

• corporation.

• sole proprietorship.

• limited liability corporation.

In a retail business, the stock held in reserve is called

• raw materials.

• inventory.

• capital.

• profits.

Which of the following phrases best defines the term limited partnership?

• an organization that limits liability to the corporation rather than the individual owners

• a partnership in which at least one partner has less responsibility in the business operations and less liability for business losses

• a business that is limited to three or fewer investors

• a business model that combines aspects of corporations and partnerships

A document certifying ownership of part of a corporation is a

• charter.

• stock certificate.

• dividend check.

• bond.