Business Basics Grade 9 - Forms of Business Test

A business with one owner is known as a:

• Company

• Sole trader

• Partnership

Advantages of a sole trader are:

• Limited liability

• The owner makes all the decisions

• The owner takes all the profit

• Can raise substantial capital

Advantages of a partnership are:

• The partners split the profit

• Unlimited liability

• Raise more capital than a sole trader

• Share the workload

What is the most common form of business ownership?

• Corporation
• Company
• Sole Proprietorship
• LLC

Which of the following best describes the term limited liability? If the business fails:

• Personal possessions of the owner can be taken to pay any debts

• The owner is personally liable for all the debts of the business

• There is no limit on the amount the owner has to pay to settle debts

• The owner only loses the amount invested in the business

Which of the following is a drawback for an entrepreneur setting up a business as a sole proprietorship?

• Profit is shared

• Financial accounts are kept private

• Limited liability

• Unlimited liability

Which legal structure would an individual wishing to start-up a small business choose because it is quick, easy and inexpensive to set up?

• Sole proprietorship

• Partnership

• Privately Held Corporation

• Corporation

Two Brothers Pizza would most likely show which type of ownership

• Partnership

• Corporation

• Stock and Bonds

• Single Ownership

This refers to a person/ company that is granted a license to do business under the franchisor's trademark and trade name.

• FRANCHISOR

• PARTNER

• SOLE PROPRIETOR

• FRANCHISEE

Not for profit organisations are also commonly referred to as:

• Public companies

• Social enterprises

• Public sector enterprises

• Franchise