Introduction to Business

Section 1: Types of Business Ownership

Self-Checks

1
Sole proprietorships account for about ______ of all the businesses in the United States.
A)30 percent
B)50 percent
C)70 percent
D)90 percent
2
Income from a sole proprietorship is ______ .
A)not taxed
B)taxed once
C)taxed twice
D)taxed three times
3
One of the disadvantages of having a partnership is ______ .
A)double taxation
B)high startup costs
C)tax on dividends
D)unlimited liability
4
A major advantage of forming a corporation is ______ liability.
A)limited
B)restricted
C)unlimited
D)unrestricted
5
An organization that is owned and operated by its members is a ______ .
A)cooperative
B)corporation
C)partnership
D)private practice
6
A contractual agreement to use the name and sell the products or services of a company in a designated geographic area is called a ______ .
A)cooperative
B)charter
C)franchise
D)partnership
7
If one of your goals is to limit your personal liability, it would be best to organize your business as a ______ .
A)corporation
B)franchise
C)partnership
D)sole proprietorship
8
During the life of a business, the way the business is organized ______ .
A)can be changed
B)changes as the company grows
C)changes when the own dies
D)never changes
9
A business owned by ten people who share the risks and rewards of the business is a ______ .
A)cooperative
B)corporation
C)franchise
D)partnership
10
The easiest way to organize a business is as a ______ .
A)cooperative
B)corporation
C)partnership
D)sole proprietorship
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