Sole Traders - Business Ownership Quiz

What is a sole trader?

• A business owned by multiple partners

• A business owned and run by one person

• A non-profit organization

• A publicly traded company

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

• Shared decision-making

• Quick and easy to set up

• Unlimited liability

• High set-up costs

What does unlimited liability mean for a sole trader?

• The business owner is not responsible for any debts

• The business owner is personally responsible for all debts

• The business can only incur limited debts

• The business owner has limited control over the business

Which of the following is a disadvantage of being a sole trader?

• Low level of responsibility

• Shared profits

• High level of responsibility

• Limited work hours

What type of tax does a sole trader pay on their earnings?

• Property tax

• Corporate tax

• Income tax

• Sales tax