Grade 8 EMS: Forms of Ownership Test

What is a sole trader?

• A business owned by a group of people.

• A business owned by a single person.

• A business owned by a government.

• A business owned by a corporation.

Which of the following is an advantage of being a sole trader?

• Unlimited liability.

• Easy to set up.

• Profits must be shared.

• Complex decision-making process.

What is a major disadvantage of a sole trader?

• Limited capital.

• Unlimited liability.

• No control over business decisions.

• Easy access to funding.

What defines a partnership?

• A business owned by one person.

• A business owned by two or more people sharing profits.

• A business owned by a corporation.

• A business owned by the government.

Which of the following is a characteristic of a partnership?

• Limited liability for partners.

• Partners share profits and losses.

• Easy access to capital through shares.

• Complex to set up and manage.

What is a disadvantage of a partnership?

• Unlimited liability for partners.

• Control is maintained by one partner.

• Profits are not shared.

• Limited workload for each partner.

How many members can a Closed Corporation (CC) have?

• No more than 5 members.

• No more than 10 members.

• No more than 20 members.

• No more than 50 members.

What is a key characteristic of a Closed Corporation?

• Limited liability for members.

• Ability to publicly trade shares.

• Unlimited liability for members.

• Complex and expensive to run.

What is a disadvantage of a Closed Corporation?

• Unlimited liability.

• Restricted number of members.

• Complex decision-making process.

• Public scrutiny and regulation.

What defines a public company?

• A company owned by a sole trader.

• A company that publicly trades its shares on the stock exchange.

• A company that is not allowed to issue shares.

• A company owned by a small group of private shareholders.