1.04 Legal Forms of Business Organization

A person who takes a risk to produce goods and services in search of profit - 

• entrepreneur
• magistrate
• profiteer
• baliff

What kind of business is BEST described by these statements?

I am the only owner of my business.

I take all the risks of doing business.

I keep all the profits.

• sole proprietorship

• corporation

• partnership

• cooperative

An entrepreneur - 

• enforces government regulations
• takes the risk to earn profit
• sets the interest rates at banks
• manages financial investments

In a corporation, owners share profit, but liability is limited to shareholder's

• investment

• distribution

• theft

• production

A form of business organization that is authorized to act as a legal entity regardless of the number of owners. 

• corporation 
• proprietorship
• partnership
• distributor

What is a disadvantage of partnerships?

• ease of formation
• owners share responsibilities
• limited liability
• possibility of personality conflict

What is the advantage of corporations?

• minimal government regulation
• limited liability
• short life span
• has one owner

The Dow Jones industrial average swept past 27,000 for the first time. Investors are increasingly optimistic about corporate earnings and the economy.

This achievement MOST likely involved which type of business organization?

• proprietorship

• partnership

• corporation

• conglomerate

In which type of organization does one person take all the risks?

• corporation

• partnership

• monopoly

• sole proprietorship

Easy to start, Owner is his/her own boss, Owner keeps all the profits - These are advantages of what type of business

• Franchise
• Corporation
• Parntership
• Sole Proprietorship