Ch. 7 Economics

What important business factor can sole proprietorships protect better than corporations can?

• Financial resources
• Information
• Customers
• Competition

What is the most popular business model in the United States today?

• Sole proprietorship
• Partnership
• Limited liability company
• Corporation

Which business type gives its owner(s) the most freedom?

• Partnership
• Corporation
• Sole proprietorship
• Limited liability company

What is the primary advantage of partnerships over sole proprietorships?

• Greater longevity
• Greater flexibility
• Greater liability protection
• Greater financial resources

What book of the Bible gives much advice about personal financial practices?

• Ecclesiastes
• Ruth
• Proverbs
• Colossians

In the eyes of the law, a corporation possesses which two important qualities?

• Liability and taxability
• Individuality and immortality
• Flexibility and profitability
• Immortality and taxability

What is the chief advantage of incorporating a company?

• Limited personal liability
• Secrecy of business information
• Freedom from excessive taxes
• Ease of formation

According to the text, what disadvantage often results from corporations' great size?

• Overemployment
• Low quality
• Inefficiency
• Impersonality

Which of the following is NOT an accurate criterion for an LLC?

• Governed by an operating agreement
• No more than fifty shareholders
• Foreign partners allowed
• No regular shareholder meetings required

Which form of business ownership pays the highest taxes?

• Sole proprietorship
• Partnership
• Corporation
• Limited liability company