Business Structures Quiz

What is one advantage of a sole trader business structure?

• Limited liability

• Easy to set up with few legal formalities

• Shared decision-making

• Profits shared between partners

What is an advantage of a private limited company (Ltd)?

• Unlimited liability

• Harder to raise finance

• Limited liability protects owners' personal assets

• Lack of continuity if owner leaves

Which business structure allows for shared decision-making?

• Sole trader

• Partnership

• Private limited company (Ltd)

• Public limited company

What is one disadvantage of a business structure with more shareholders?

• Easier decision-making

• Shares can be sold to the public

• Slower decision-making

• Increased privacy

Which of the following is an advantage of a Public Limited Company (PLC)?

• Limited liability for shareholders

• Shares cannot be sold to the public

• Less brand recognition

• More legal requirements

What is a disadvantage of a Public Limited Company (PLC)?

• Easier to attract high-quality staff

• Expensive and complex to set up

• Limited liability for shareholders

• Greater brand recognition

Why might a Public Limited Company (PLC) face a risk of hostile takeovers?

• Shares are not sold to the public

• Detailed financial information is not published

• Shares are sold to the public

• Limited liability for shareholders

What is a potential conflict in a Public Limited Company (PLC)?

• Between franchisor and franchisee

• Between owners and managers

• Between suppliers and customers

• Between shareholders and creditors

Which of the following is a disadvantage of having more legal requirements in a business structure?

• Easier decision-making

• Increased costs

• Greater brand recognition

• Limited liability

What is an advantage of a franchise in terms of marketing?

• Marketing is handled individually

• Marketing is often handled centrally

• Marketing is not required

• Marketing is limited to local areas