Understanding Business Ownership Types

What is the simplest form of business ownership?

• Partnership

• Sole Proprietorship

• Limited Liability Company

• Franchise

Which of the following is an advantage of a sole proprietorship?

• Limited liability

• Easy to establish

• Shared decision-making

• Access to more capital

What is a major disadvantage of partnerships?

• High start-up costs

• Unlimited liability

• Limited access to resources

• Difficult to dissolve

Which of the following is a characteristic of a limited liability company (LLC)?

• Owners are personally liable for debts

• Profits are taxed twice

• Combines elements of partnerships and corporations

• Only available to large businesses

In a franchise business model, what does the franchisee typically receive from the franchisor?

• Complete ownership of the brand

• A share of the franchisor's profits

• The right to use the franchisor's business model and brand

• Free products and services

Which of the following is a characteristic of a public limited company (PLC)?

• Shares are not available to the general public

• Limited to 50 shareholders

• Shares can be traded on the stock exchange

• Unlimited liability for shareholders

What is a key feature of a private limited company (Ltd)?

• Shares can be sold to the public

• Limited to 50 shareholders

• Shareholders have unlimited liability

• Shares are not publicly traded

Which type of business ownership offers the most control to the owner?

• Partnership

• Sole Proprietorship

• Limited Liability Company

• Public Limited Company

What is a common disadvantage of a franchise for the franchisee?

• High level of autonomy

• Limited support from franchisor

• High initial investment and ongoing fees

• No brand recognition

Which of the following is a benefit of forming a limited liability company (LLC)?

• Double taxation

• Personal asset protection

• Unlimited liability

• Complex formation process