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Ch 2 REVIEW Understanding Characteristics of Businesses

Total questions: 28

Worksheet time: 3hrs 58mins

Name
Class
Date
1.

A business owned and operated by a single individual

a)

sole proprietorship

b)

partnership

c)

corporation

d)

limited liability company

e)

general partnership

2.

A form of business owned by two or more individuals who share management and profits

a)

limited liability company

b)

corporation

c)

partnership

d)

sole proprietorship

e)

s-corporation

3.

A business owned by stockholders who share in profits and losses

a)

partnership

b)

corporation

c)

sole proprietorship

d)

general partnership

e)

franchise

4.

Type of ownership that joins elements of a corporation and a partnership

a)

partnership

b)

corporation

c)

limited liability company

d)

franchise

e)

sole proprietorship

5.

An organization that generates income for its owners

a)

Non-profit

b)

manufacturer

c)

board of directors

d)

perfect competition

e)

profit business

6.

A company that is created to benefit a public interest; does not earn profits for its owners

a)

Non-profit

b)

marketer

c)

perfect competition

d)

oligopoly

e)

franchise

7.

A business model where the owner of a company grants another business owner the right to use the owner company's name

a)

corporation

b)

partnership

c)

franchise

d)

limited liability company

e)

s-corporation

8.

A group of people elected by stockholders who make decisions for a corporation.

a)

Extractor

b)

Board of Directors

c)

Employees

d)

Profit business

e)

Corporation

9.

A person who owns stock in a corporation

a)

employee

b)

franchise

c)

general partnership

d)

stockholder

e)

customer

10.

Which of the following is an example of a non-profit organization?

a)

Beauty salon

b)

American Red Cross

c)

McDonalds

d)

Amazon

11.

What are types of business models?

(Check all that may apply)

a)

Direct Sales

b)

Indirect Sales

c)

S-Corporation

d)

Retail

12.

What is an advantage of a Corporation?

a)

Unlimited Liability

b)

Full Control

c)

Continued Life

d)

Affordable to start

13.

What is unlimited liability?

a)

It means you do have to pay the debts of the company you own

b)

It means you have no company debts

c)

It means you don't have to pay the debts of the company you own

14.

Which of these is NOT an advantage of Sole Proprietorship?

a)

Easy to form

b)

You decide how profits are spent

c)

You don't need to share your trade secrets or financial details

d)

Unlimited liability if the company fails

15.

What are the two distinct characteristics of a corporation?

a)

They are owned by shareholders

b)

They have a Board of Directors

c)

They are easy to form

d)

They can be dissolved in an owner dies

16.
Only liable for up to the amount invested into the company, and has little to no voice in management.
a)
General Partner
b)
Proprietor
c)
Limited Partner
d)
Corporation
17.
What is the most common form of business ownership?
a)
Corporation
b)
Company
c)
Sole Proprietorship
d)
LLC
18.
What type of corporation combines the benefits of a partnership and a corporation?
a)
Limited Liability Company
b)
Trust
c)
Company
19.
This type of business is subject to many more laws and are more difficult to form.
a)
Proprietorship
b)
Partnership
c)
Corporation
d)
Franchise
20.
The major policy and financial decision makers of a corporation are determined by the...
a)
CEO/GM/President
b)
Chairman of the Board
c)
Shareholders
d)
Board of Directors
21.
McDonald's and Burger King are examples of....
a)
Sole Proprietorships
b)
Partnerships
c)
Corporations
d)
Franchises
22.

It is an organization which is formed voluntarily by a group of people to conduct economic activities that are beneficial and respond to the need and aim of it's members.

a)

Market

b)

Cooperatives

c)

Economy

d)

Sufficiency

23.

What is the purpose of a Non-profit business structure?

a)

To gain as much profit as possible

b)

Taxed like a corporation

c)

To not make money

d)

A cause that is something other than making a profit

24.

Advantages:

- cheap to organize

- easy to start and operate

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

25.

Advantages:

- ownership by a group of individuals

- shared responsibility for any profits,

debts and decisions related to the business

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

26.

Advantages:

- ownership divided into shares of stock

- management or decision-making

shared by board of directors

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

27.

Disadvantages:

- more expenses involved

- more rules and regulations to comply with

a)

PARTNERSHIP

b)

CORPORATION

c)

SOLE PROPRIETORSHIP

d)

FRANCHISE

28.
Partners who are only responsible up to the extent of their investment
a)
limited partnership
b)
trading partnership
c)
non-trading partnership
d)
special partnership