AnswersRAIL NCAA OC Economics 2027Business Structures

Business Structures Answers

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1
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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
2
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Cooperatives save members money by

A
purchasing supplies and services as a group.
B
securing financing from banks as a group.
C
charging more to sell their products as a group.
D
sharing all profits democratically as a group.
3

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.
4

Which can be considered disadvantages of sole proprietorships and partnerships?

A
Partnerships require many people to write a charter, while sole proprietorships require one person to write a charter.
B
Sole proprietorships require one person to know complicated tax laws, while partnerships require many people to know the rules.
C
Partnerships require one person to do many things, while sole proprietorships require many people to weigh in on decisions.
D
Sole proprietorships require one person to do many things, while partnerships require many people to weigh in on decisions.
5

Which are examples of sole proprietorships? Check all that apply.

A
lawyers working for a corporation
B
doctors in a partnership
C
independent workers
D
franchise restaurants in a partnership
E
tax preparer working his own business
F
freelance writers
6

Which best describes the difference between sole proprietorships and partnerships?

A
Sole proprietors keep all profits and have unlimited liability, while partners split profits and share liabilities.
B
Sole proprietors share responsibilities, while partners are responsible for only a portion of the business.
C
Sole proprietors split profits and share liabilities, while partners keep all profits and have unlimited liability.
D
Sole proprietors pay taxes only on business profits, while partners do not have to pay taxes on profits.
7

Franchises are attractive to business owners because

A
they have a proven business model.
B
they are typically inexpensive to buy.
C
they get to keep all profits.
D
they come with very little risk.
8

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.
9

Entrepreneurs who want to open a franchise

A
buys the rights from the parent company and creates his or her own rules.
B
buy the rights from the parent company and invest in a location approved by the parent company.
C
invest in a location and create a business model for the franchise.
D
invest in a location and develop a trademark for the franchise.
10

How do corporations raise money and resources to expand? Select THREE answers.

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.

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