Business Studies Practice 2.1

A company wants to computerize its accounting system. It issues stocks to raise additional funds. What type of business ownership best describe the statement?

• Sole Proprietorship

• Corporation

• Partnership

Mr. Wells owns a card shop. Because baseball cards have declined in popularity his business is struggling. He decides he has to sell his house to pay off his business debts. What type of business ownership best describe the statement?

• Sole Proprietorship

• Corporation

• Partnership

What characteristic of a corporation is missing from the diagram on the below?

• Owner shares the profits with family members only

• Main owner receives the majority of profits

• Stockholders share the profits

• Board of Supervisors has the final say on new products

What does PLC stand for?

• Public Limited Company

• Princesses Like Crowns

• Profit/Liability Curve

• Probably Locking Cages

One disadvantage of a joint venture is

• Low cost

• Both businesses will bring more knowledge and skills into the new project

• Both businesses does not agree in decision making

What does the franchisor provide for those purchasing the franchise?

• advice

• advertising

• training

• all of these are provided

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

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

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

• The owner only loses the amount invested in the business

These business owners may have trouble raising capital. What type of business ownership best describe the statement?

• Sole proprietorship

• Corporation

• Partnership

• Franchise

The main disadvantage of a __________ is that each person is fully responsible for the acts of all other persons.

• Proprietorship

• Corporation

• Partnership

• Franchise

What is one disadvantage of a public limited company?

• Stock market vulnerability

• Limited liabilities.

• They cannot buy cars.

• They cannot buy shares.