Types of Business Organizations Quiz

What is a Sole Trader/Sole Proprietorship?

• A business organization owned and controlled by shareholders

• A business organization owned and controlled by multiple people

• A business organization owned and controlled by one person

• A business organization owned and controlled by the government

What is an advantage of a Sole Trader/Sole Proprietorship?

• No need to publish annual financial accounts

• Ability to raise huge amounts of capital

• Full control over the business

• Limited liability

What is a Partnership?

• A legal agreement between two or more people to own, finance, and run a business jointly

• A business organization that can sell shares to raise capital

• A business organization owned and controlled by the government

• A business organization owned and controlled by one person

What is a disadvantage of a Partnership?

• Ability to provide new skills and ideas

• Conflicts between partners

• No need to publish annual financial accounts

• Limited liability

What are Joint-stock companies known for?

• Inability to sell shares to raise capital

• No continuity if an owner retires or dies

• Limited liability for shareholders

• Unlimited liability for shareholders

What is an advantage of Joint-stock companies?

• No continuity if an owner retires or dies

• Limited liability for shareholders

• No need to disclose financial information

• Ability to raise huge amounts of capital

What is a Franchise?

• A business organization that can sell shares to raise capital

• A business organization owned and controlled by the government

• A legal agreement between two or more businesses to work together on a project

• A business organization where the owner grants a license to another person to use their business idea

What is a disadvantage of a Franchise?

• An established brand and trademark

• Full control over the business

• No need to pay franchise fees and royalties

• Loss of control over running of business

What is a Joint Venture?

• A business organization owned and controlled by one person

• A business organization that can sell shares to raise capital

• A business organization where the owner grants a license to another person to use their business idea

• A legal agreement between two or more businesses to work together on a project

What is an advantage of a Joint Venture?

• Reduces risks and cuts costs

• Limited liability for shareholders

• No continuity if an owner retires or dies

• Ability to raise huge amounts of capital