Ownership & Stock Market Quiz

What is the main disadvantage of a sole proprietorship in terms of financial responsibility?

• Limited liability

• Shared debt with partners

• Full responsibility for all debts

• No financial responsibility

Which of the following is NOT mentioned as a disadvantage of a sole proprietorship?

• High costs and time commitment

• Difficulty obtaining funding

• Lack of fringe benefits

• Limited market reach

A partnership is defined as:

• A business owned by one person

• A form of business where two or more people own and operate together

• A government-owned enterprise

• A type of corporation

Which of the following is an advantage of a partnership?

• Limited liability

• Simplified tax structure

• Combined resources

• Guaranteed profits

In a partnership, if one partner makes a mistake:

• Only that partner is responsible

• The business is automatically dissolved

• All partners are responsible

• The government takes control

What is a potential disadvantage of a partnership regarding business continuity?

• Uncertain life/transferability

• Guaranteed longevity

• Automatic succession planning

• Perpetual existence

In a corporation, the owners are called:

• Partners

• Proprietors

• Shareholders

• Franchisees

Which of the following is NOT an advantage of a corporation?

• Limited liability for shareholders

• Easier to raise funds

• Lower tax rate

• Simplified formation process

What does "limited liability" mean for corporate shareholders?

• They can't lose money

• They are not responsible for the company's debts beyond their investment

• They have no financial responsibilities

• They are fully responsible for all company debts

Which of these is a disadvantage of a corporation?

• Easy to form and operate

• Simple ownership structures

• High employee commitment

• Dual taxation