Business Forms Quiz

In which form of business does the owner have the highest level of secrecy and direct customer interaction?

• Partnership

• Sole Proprietorship

• Joint Stock Company

• Co-operative Society

True/False: One demerit of a Joint Stock Company is the possibility of unhealthy speculation due to stock market activities.

• True

• False

Assertion (A): Sole proprietorship allows quick decision-making. Reason (R): All decisions are made by the government in a sole proprietorship.

• Both A and R are true and R is the correct explanation of A

• Both A and R are true, but R is not the correct explanation

• A is true, R is false

• A is false, R is true

Which of the following is a merit of partnership?

• Uncertainty of life

• Unlimited liability

• Shared risk

• Conflicts among partners

True/False: In a Joint Stock Company, professional managers often handle daily operations, ensuring efficient management.

• True

• False

The risk of losing personal assets due to business debts is a demerit of:

• Joint Stock Company

• Sole Proprietorship

• Co-operative Society

• Multinational Corporation

Identify the correct pair:

• Sole Proprietorship – Easy to raise large capital

• Joint Stock Company – Unlimited liability

• Partnership – Lack of public confidence

• Partnership – Life not affected by partner’s death

Assertion (A): Partnerships enjoy more balanced decision-making. Reason (R): Diverse skills and experiences of partners contribute to decisions.

• Both A and R are true, and R is the correct explanation

• Both A and R are true, but R is not the correct explanation

• A is true, R is false

• A is false, R is true

Which of these is a demerit of a Joint Stock Company?

• Continuity of existence

• Public goodwill

• Excessive government control

• Transferability of shares

True/False: Flexibility of operations is a common merit of sole proprietorship and partnership.

• True

• False