AnswersEconomicsBusiness and Government — TestQuestion 25
25
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Business and Government — Test

Question 25 • Economics

Which can be considered disadvantages of sole proprietorships and partnerships?

Answer
A
Sole proprietorships require one person to do many things, while partnerships require many people to weigh in on decisions.
B
Partnerships require one person to do many things, while sole proprietorships require many people to weigh in on decisions.
C
Sole proprietorships require one person to know complicated tax laws, while partnerships require many people to know the rules.
D
Partnerships require many people to write a charter, while sole proprietorships require one person to write a charter.

Explanation

A sole proprietor often handles many roles alone, which can be demanding. In a partnership, decisions may take longer because the partners need to discuss and agree on them. These are disadvantages of the two business forms described in choice A.

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