Types of Businesses

How is a corporation different from a sole proprietorship or partnership?

• A corporation has only one or two owners.

• A corporation is usually owned by one person.

• A corporation requires a legal charter with the state.

• The owners (stockholders) have limited liability.

Which type of business allows the owner to keep all of the profit for him/herself?

• Partnership

• Franchise

• Sole Proprietorship

• Corporation

Which business type is most difficult to start out of all four types of businesses?

• Partnership

• Franchise

• Sole Proprietorship

• Corporation

How is a corporation different from a sole proprietorship?

• Sole proprietorship's require a legal charter to start.

• Sole proprietorships can be global/multinational businesses.

• Corporations are owned by only one person.

• Corporations can sell stock to raise money for the business.

What is an advantage of a franchise over a sole proprietorship?

• Parent company provides training and support to franchisee.

• Parent company will pay all of franchisee's start up cost.

• Franchises must sell only certain products or services.

• Some franchisors are strict about how the business is run.

Which business depends on just one person for the skills and talents to run the business?

• Sole Proprietorship

• Partnership

• Corporation

• Franchise

Which type of business has limited liability?

• Sole Proprietorship

• Partnership

• Corporation

• Franchise

More people in the world start corporations than sole proprietorships

• True
• False

Disadvantage of a Sole Proprietorship:

• Inexpensive to create
• Make your own decisions
• Least regulated
• Unlimited liability

Top advantage of Sole Proprietorship

• Owner receives all profit
• Difficult to raise capital
• Long hours
• Work by yourself