Intro Chapter 6 - Business Ownership

Unlimited liability means

• the owner is responsible for only accidents that occur on business property.
• the owner is responsible for the company’s debts.
• the owner must have insurance.
• the owner shares the liability with the company’s stockholders.

An advantage of a partnership is

• that the partners make decisions together
  
• that the banks often more willing to lend money to a partnership than to a sole proprietship
• that the partners often bring different skills and talents to the business
• all of the above

In order to start a corporation, the first thing one must do is

• obtain a corporate charter (articles of incorporation) from the state government

• hire an accountant and an attorney

• hire employees

• start bank accounts

Nonprofit organizations

• focus on providing services rather than making a profit
• outnumber sole proprietorships in the United States
• must still pay taxes
• do not register with the government

An example of a franchise is

• a McDonald's restaurant
• a "mom and pop" grocery store
• a Sears department store
• a Wal-Mart superstore

Cooperatives were formed to

• save money on the purchase of certain goods and services
• sell more products
• promote each other
• help people cooperate

A dividend is

• 
  the cost of a share of stock.
  
• a tax paid by stockholders.
• the money made as a result of owning a share of stock.
• the money lost on a share of stock.

What is a form of business ownership in which 2 or more people jointly owns a business

• Sole Proprietorship
• Company
• Partnerships

What is the name of a person who owns part of a corporation?

• Stakeholder
• Shareholder
• Trust Agent
• Chairman

This type of business is subject to many more laws and are more difficult to form.

• Proprietorship
• Partnership
• Corporation
• Franchise