Business Plan and Business Structures Quiz

What is the role of a business plan?

• To outline the financial statements of a company

• To provide a strategy for the marketing team

• To guide the direction and objectives of a business

• To record the minutes of business meetings

Why are business plans important?

• They are required for legal purposes

• They help in securing investment and finance

• They are used to recruit employees

• They are necessary for customer service improvement

Define sole trader:

• A company with shares traded on the stock exchange

• An individual running a business on their own

• A partnership between two or more individuals

• A large corporation with limited liability

Define unlimited liability:

• When a business's debts are limited to its investment

• When a business's debts are the sole responsibility of its shareholders

• When a business owner is personally responsible for all the debts of the business

• When a business has no financial obligations

Define limited liability:

• When a business owner is responsible for all company debts

• When a business's debts are limited to the amount invested by shareholders

• When a business has an unlimited financial obligation

• When a business is exempt from paying debts

Define partnership:

• A business owned by a single individual

• A business owned by shareholders

• A business owned and operated by two or more individuals

• A non-profit organization

What are the benefits of being a sole trader?

• Limited liability protection

• Easy to raise capital

• Complete control over business decisions

• Tax benefits of a corporation

What are the drawbacks of being a sole trader?

• Shared decision-making

• Unlimited liability

• Less paperwork

• More investment opportunities

What are the benefits of a partnership?

• Single person control

• Shared skills and resources

• Limited liability

• No need for registration

What are the drawbacks of a partnership?

• Shared profits

• More investment opportunities

• Easier to manage

• Limited liability