Answers26-27 Ignite Economics-KY-EconomicsBusiness Structures

Business Structures Answers

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1
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Which best describes the difference between preferred and common stocks?

A
Preferred stock allows shareholders to vote for a board of directors, while shareholders of common stock do not have voting rights.
B
Common stock gives shareholders one vote per share owned, while shareholders of preferred stock do not have voting rights.
C
Preferred stock gives shareholders priority for dividends distributed, while shareholders of common stock are not allowed dividends.
D
Common stock allows shareholders to get priority for dividends distributed, while shareholders of preferred stock are not allowed dividends.
2
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The most common business organizations in the United States are

A
partnerships.
B
sole proprietorships.
C
corporations.
D
franchises.
3

shareholderspartnersbankersboard members

A
shareholders
B
partners
C
bankers
D
board members
4

The main advantage that corporations have is

A
limiting liability for owners and stockholders.
B
giving many owners a say in business decisions.
C
being inexpensive and easy to establish.
D
requiring fewer state and federal regulations.
5

What happens to earnings in a cooperative?

A
They are used to pay middlemen for services.
B
They are shared with member owners.
C
They are used to buy more stock for members.
D
They are shared with customers through dividends.
6

How do corporations raise money and resources to expand? Select THREE answers.They request a bank loan.They raise franchise fees.They cash in dividends.They agree to sell stocks.They issue bonds.

A
They request a bank loan.
B
They raise franchise fees.
C
They cash in dividends.
D
They agree to sell stocks.
E
They issue bonds.
7

Franchising is typically done by

A
cooperatives.
B
partnerships.
C
LLC
D
corporations.
8

Which document determines the number of shares in a company?

A
a stock prospectus
B
an annual bill of rights
C
a corporate charter
D
an annual report
9

A disadvantage of forming a partnership is that owners

A
can find it tougher to start and stop a business.
B
can find it more difficult to get a bank loan.
C
are only responsible for their own finances.
D
are fully responsible for their partners' losses.
10

feestaxesinsuranceinterest

A
fees
B
taxes
C
insurance
D
interest

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