economics test 2/5

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

• competition

• customers

• information

• financial resources

The most popular business model in the United States today is

• the sole proprietorship

• the partnership

• the limited liability company

• the corporation

Which business type gives its owners the most freedom?

• sole proprietorship

• general partnership

• limited liability company

• corporation

What great risk balances out the many advantages of both the sole proprietorship and partnership models?

• limited management skills

• lack of accountability

• unlimited financial liability

• lack of independence

Which of the following is not a question that a general partnership contract must answer?

• what is each partner responsible to do?

• how may a partner withdraw from the partnership?

• how are the profits divided?

• what is the limit of each partners liability?

Many law and accounting firms use the partnership model because of its ability to?

• acquire greater management skills

• expand sources of financing

• retain competent employees

• remain easy to form and manage

What is the primary advantage of partnerships over sole proprietorship?

• greater longevity

• greater financial resources

• greater flexibility

• greater liability protection

What book of the bible gives much advice about personal finance practices?

• Ruth

• Proverbs

• Ecclesiastes

• Colossians

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

• immorality and taxability

• flexibility and profitability

• liability and taxability

• individuality and immorality

Suppose you buy 70,000 shares of a particular corporation’s stock, if the company has issued a total of 280,000 shares, how much of the company do you now own?

• 1/4

• 1/3

• 1/2

• 2/3