Business Organization Test

Front

The most popular business model in the United States today is

Back

the sole proprietorship.

Front

Advantages of this business type are that the owner is their own boss and gets to keep all the profits.

Back

Sole Proprietorship

Front

Disadvantages for this type of business include: owner pays for everything, hard to get money to start from the bank, owner might lack skills and unlimited liability, as well as a limited life.

Back

Sole Proprietorship

Front

Characteristics include owned by two or more people and may be general or limited

Back

Partnership

Front

What is the primary advantage of partnerships over sole proprietorships? Options: greater longevity, greater financial resources, greater flexibility, greater liability protection

Back

greater financial resources

Front

What is a major advantage of a business that is a partnership rather than a sole proprietorship?

Back

The responsibility for the business is shared.

Front

Disadvantages include limited life and the potential for conflict between partners

Back

Partnership

Front

How is a general partnership organized?

Back

Every partner shares equally in both responsibility and liability.

Front

A partnership in which all partners assume full personal liability for debts of the firm

Back

general partnership

Front

Partners who are only responsible up to the extent of their investment

Back

limited partnership