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Types of Businesses Quiz (MC)

Total questions: 20

Worksheet time: 40mins

Name
Class
Date
1.

The most common type of business organization in the United States in the _________.

a)

corporation

b)

partnership

c)

sole proprietorship

2.
Sara’s Hair Palace is a small, locally owned beauty salon in Sterling. This represents what type of business?
a)
corporation
b)
partnership
c)
sole proprietorship
3.
Dan has $5,000. He wants to invest his money in the type of business that has the least amount of liability. In which type of business should he invest?
a)
corporation
b)
partnership
c)
proprietorship
4.
A business partnership has ___________ who share the risks and the profits.
a)
One owner
b)
No more than three owners
c)
Two or more owners
d)
Five or more owners
5.
Which of the following is an advantage of the corporation as a form of business ownership:
a)
Less complex requirements
b)
Separate owners and managers
c)
Limited liability
d)
High Taxes
6.
In which of the following would one person be responsible for all of the risks but also receive all of the profits?
a)
Corporation
b)
Propreitership
c)
Partnership
d)
Dual owner business
7.
What is a company called that sells stock to raise money?
a)
Partnership
b)
Corporation
c)
Sole Proprietorship
d)
Limited Partnership
8.
What is a disadvantage of partnerships?
a)
ease of formation
b)
owners share responsibilities
c)
limited liability
d)
possibility of personality conflict
9.
Which is ONE disadvantage of Sole Proprietorship?
a)
Less direct control
b)
Disagreements
c)
Hard to raise money
10.
Disadvantages for this type of business include: owner pays for everything, hard to get money to start from the bank, owner might lack skills & unlimited liability.
a)
Sole Proprietorship
b)
Partnership
c)
Corporation
d)
Franchise
11.

A _________ acts like business, but its purpose is to benefit society.

a)

Franchise

b)

Limited Liability Partnership

c)

Nonprofit organization

d)

corporation

12.

A __________ takes place when firms involved in different steps of manufacturing or marketing come together.

a)

horizontal merger

b)

diagonal merger

c)

circular merger

d)

vertical merger

13.

What is a cooperative?

a)

a semi-independent business that buys the right to run a franchise

b)

a business operated for the shared benefit of its owners, who are also its customers

c)

a business that licenses the right to sell its products in a particular area

d)

an institution that acts like a business organization but which does not make a profit

14.

What is it called when companies that produce the same product merge?

a)

multinational corporation

b)

vertical merger

c)

conglomerate

d)

horizontal merger

15.

What is the name for an individual who owns a share of a corporation and is entitled to part of its profits?

a)

stockholder

b)

president

c)

officer

d)

director

16.

What is a potential disadvantage of corporations?

a)

Limited liability

b)

Easier expansion financing

c)

Subject to more paperwork

d)

Considered an individual

17.

In a corporation, who is responsible for major decision-making?

a)

Partners

b)

Shareholders

c)

Board of Directors

d)

Employees

18.

This is a type of business in that pays fees to a parent company in return for the right to sell a certain product or provide a certain, specific service.

a)

Non-profit

b)

Cooperative

c)

Franchise

d)

Proprietorship

19.
Which of the following is a disadvantage of a sole proprietorship? 
a)
it is easy to start
b)
he owner is personally and fully responsible for all losses and debts of the business. If the business fails, the owner’s personal possessions may be taken away to satisfy business debts.
c)
requires a partner
d)
it is easy to raise the financial capital to start
20.
Which of the following is a disadvantage of a sole proprietorship? 
a)
it is easy to start
b)
he owner is personally and fully responsible for all losses and debts of the business. If the business fails, the owner’s personal possessions may be taken away to satisfy business debts.
c)
requires a partner
d)
it is easy to raise the financial capital to start