Business Organizations Basics Quiz

Where do most goods and services in a market economy come from?

• Government agencies

• Business organizations

• Non-profit organizations

• Individual entrepreneurs

What is the primary purpose of most business organizations?

• To provide jobs

• To earn a profit

• To pay taxes

• To meet consumer demand

How do business organizations achieve their purpose?

• By reducing costs

• By producing goods and services

• By increasing taxes

• By hiring more employees

What type of business is owned by two or more people who share responsibilities and profits?

• LLC

• Partnership

• Non-Profit

• Co-Op

What type of liability do sole proprietors have?

• Limited liability

• No liability

• Unlimited liability

• Shared liability

How are sole proprietorships regulated compared to other business organizations?

• Heavily regulated

• Lightly regulated

• Not regulated at all

• Regulated only by federal laws

What must a sole proprietor do regarding employee treatment?

• Follow personal preferences

• Ignore labor laws

• Treat employees according to labor laws

• Only follow federal regulations

Who keeps the profits in a sole proprietorship?

• The government

• The sole owner

• The employees

• The board of directors

What happens to a sole proprietorship if the owner dies, retires, or chooses to leave?

• It continues under new management

• It merges with another company

• It closes

• It becomes a corporation

What is the greatest disadvantage of a sole proprietorship?

• Limited liability

• Unlimited liability

• Shared responsibility

• Tax benefits