Business Structures

Question 1

Which document determines the number of shares in a company?

Revolt · Accepted Answer

a corporate charter

Question 2

What happens to earnings in a cooperative?

Revolt · Accepted Answer

They are shared with member owners.

Question 3

An entrepreneur who opens a franchise must

Revolt · Accepted Answer

assume debts.

Question 4

Which best describes the difference between preferred and common stocks?

Revolt · Accepted Answer

Common stock gives shareholders one vote per share owned, while shareholders of preferred stock do not have voting rights.

Question 5

shareholderspartnersbankersboard members

Revolt · Accepted Answer

shareholders

Question 6

A disadvantage of forming a partnership is that owners

Revolt · Accepted Answer

are fully responsible for their partners' losses.

Question 7

Which best describes the difference between sole proprietorships and partnerships?

Revolt · Accepted Answer

Sole proprietors keep all profits and have unlimited liability, while partners split profits and share liabilities.

Question 8

Franchises are attractive to business owners because

Revolt · Accepted Answer

they have a proven business model.

Question 9

Entrepreneurs who want to open a franchise

Revolt · Accepted Answer

buy the rights from the parent company and invest in a location approved by the parent company.

Question 10

The main advantage that corporations have is

Revolt · Accepted Answer

limiting liability for owners and stockholders.

Business Structures Answers