L2 Types of Business Ownership

Which of the following types of business ownership involves one exclusive owner of a business?

• Public limited company

• Partnership

• Sole trader

• Private limited company

Which of the following types of business ownership involves trading of shares on the stock market?

• Franchise

• Public limited company

• Partnership

• Private limited company

In a franchise business, the franchisor...

• is the business selling the right to trade its product or service

• has to give a percentage of profits to the franchisee

• is the company or person buying the franchise

• has restricted control over the business

In a franchise business, the franchisee...

• is the business selling the right to trade its product or service

• gets to keep 100% of profits made

• is the company or person buying the franchise

• owns the business idea, product and system of operation

In a business partnership, each partner shares responsibility for managing the company and its profits and losses.

• True

• False

A private limited company will have which of the following at the end of its name...

• Plc

• Lcp

• Ptd

• Ltd

A public limited company will have which of the following at the end of its name...

• Plc

• Lid

• Pub

• Ltd

In the event of a business going bust, shareholders are only liable to lose up to the amount they invested, this condition is called...

• Controlled liability

• Limited liability

• Unlimited liability

• Restricted liability

In a private limited company, shares are offered to members of the public.

• True

• False

Which of the following is a disadvantage to the franchisee?

• They have to pay a percentage of their profits to the franchisor every year

• They have to use their own funds (or bank loan) to set up the business

• They have restricted control

• All of the above