| Question |
Answer |
| What is a business firm? | An organization that uses resourses to prduce goods and services which are sold to consumers, firms, and the government. |
| What are the most productive businesses? | Corporations |
| In a sole proprietorship,who is responsible for all debts, gets all profits, and makes all decisions? | The one owner. |
| Which business form has the longest long life span? | Corporation |
| What are 3 disadvantages of the sole proprietorship? | Unlimited liability, limited growth potential, and limited life. |
| What is a cooperative? | A business that provides services to its members and is not run for profit. |
| What is a partnership? | It is a business form that is owned by 2 or more persons who shre any profits that business earns, and are legally responsible for any debts. |
| What is the difference between a general and a limited partnership? | General partnership--all partnerships share equal responsibility for management and debts; Limited partnership--limited partners do not manage the business and have limited liability. |
| What are the disadvantages of a partnership? | 1. Risky;trust issues; 2. unlimited liability; 3. lack of longevity |
| What are the two types of partnerships? | General and limited |
| What are some of the advantages of a partnerships? | 1. Shared business capital; 2. shared decision making; 3. easy to form; 4. requires little capital to start |
| What are some of the advantages of the sole proprietorship? | 1.requires little capital; 2. easy to form; 3. receives all profit; 4. personal satisfaction |
| What is the most common form in the US? | Sole proprietorship |
| Who have no liability in a corporation? | Stockholders |
| Which business can sell stocks and bonds? | Corporation |
| What are the advantages of a franchise? | 1. national advertising; 2.well-known; 3. financial assistance; 4. proven record of success |
| What are the disadvantages of a franchise? | 1. No room for innovation or creativity; 2. Must follow guidelines in contract |
| What is a franchise? | Contract by which a firm lets a person or group of people use its goods and sell its good or services. |
| Name some franchises. | McDonald's, Burger King, Wendy's, Domino's, KFC, Olive Garden, Dunkin' Donuts, Red Lobster |
| Name the 3 major types of cooperatives. | Consumer Cooperative, Service, Producer Cooperative |
| What do all cooperatives have in common? | They are not in business to make money. |
| Name a consumer cooperative. | Sam's Club, BJ's Cosco |
| Name a service cooperative. | Any credit union, DE Electric Cooperative |
| Namea producer cooperative. | A farmers' marketing cooperative |
| What is a corporation? | A business organization owned by stockholders and treated by law as an individual legal entity. |
| What are the advantages of a corporation? | 1.Limited liability; 2. Easy to raise capital,profit, and losses. 3.Longevity |
| What are the disadvantages of a corporation? | 1.Lack of personal satisfaction for stockholders; 2. Slow decision-making process; 3.Profits are taxed twice; 4. complex to set up |
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