Unit 1 Knowledge True or False

Companies have shareholders so they benefit from more ideas

• True

• False

Limited liability protects shareholders. This means that investors are more willing to invest. This is the purpose of limited liability.

• True

• False

The owner of the 7-Eleven franchise (CP/True) keeps 100% of the profits made by all 7-Elevens.

• True

• False

McDonalds, Chob Cha and 7 Eleven are franchises

• True

• False

As an economy develops, the tertiary sector grows to be the biggest sector. This creates a growth in demand for services.

• True

• False

The main reason for creating a joint venture is for separate companies to stay separate, but still share costs, expertise and profits.

• True

• False

A joint venture is created by two separate companies who share the cost, control and profit

• True

• False

A joint venture is a separate company from the parent companies

• True

• False

Limited liability means the shareholders do not pay for a company's debts

• True

• False

In a company, the shareholders are the owners

• True

• False