Unit 3: Lesson 1 Quiz

Fill in the blank: A ______ is a business structure that involves a legal agreement between two or more parties.

• A) Corporation

• B) Partnership

• C) Sole Proprietorship

• D) Franchise

Which of the following best describes a sole proprietorship?

• A business entity that is legally separate from its owners.

• A business that is formed primarily for the purpose of raising capital through stockholders.

• A business owned and operated by a single individual with full control.

• A business owned by multiple individuals sharing profits and liabilities.

Franchisees operate a branch of a _______ company.

• larger

• smaller

• independent

• local

Which of the following is a key feature of a franchise?

• Licensing of brand name

• Ownership of brand

• Creation of brand

• Sale of brand

In a Limited Liability Company, owners have ______ liability for business debts.

• unlimited

• limited

• no

• shared

Why might a cooperative face challenges in raising capital?

• They focus exclusively on profit maximization.

• They are funded solely by members.

• They have complex management structures.

• They attract many outside investors.

Cooperatives are common in which sectors?

• Technology and finance

• Agriculture, retail, and housing

• Entertainment and media

• Pharmaceuticals and healthcare

Why can decision-making be a challenge in cooperatives?

• It is quick and efficient

• It is democratic and time-consuming

• It is autocratic and fast

• It is centralized and efficient.

Which of the following is essential for entrepreneurs?

• Understanding business structures

• Knowing the latest fashion trends

• Traveling frequently

• None of the above.

Franchises require payment of ______ to the franchisor.

• Dividends

• Royalties

• Interest

• Rent