Econ-Chapter 8, Section 1 And 2 Question Preview (ID: 60280)


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Unlimited liability means that:
a) Shareholders of a company receive dividends only if the company earns a profit
b) The owner of the business bears complete legal responsibility for all debts and damages arising from doing business
c) A business cannot lose more than a preset amount
d) Credit can be obtained more easily than in a business that has limited liability

Where can a person look for help in starting a new business?
a) The government and the Internet
b) The board of directors of a large corporation
c) Banks and the Better Business Bureau
d) Owners of similar businesses in the same area

In a limited partnership:
a) All partners are equal
b) A bank limits the partnership's liability
c) Some partners bear no risk
d) A general partner manages the business

These two types of businesses have unlimited liability
a) Joint venture and vertical merger
b) Corporation and joint venture
c) Limited partnership and horizontal merger
d) Sole proprietorship and partnership

This person assumes all the management duties and has full responsibility for the debts of the partnership:
a) Proprietorship
b) Limited partnership
c) General partnership
d) Corporation

A disadvantage of sole proprietorships and partnerships is that they have:
a) No assets
b) Unlimited liabilty
c) Common stock
d) Little borrowing power

Entrepreneurs are people who:
a) Sit on a corporate board of directors
b) Earn profits
c) Pay dividends
d) Start new businesses

A partnership set up for a specific purpose for a short period of time is known as a:
a) Joint stock company
b) Acting board of directors
c) Joint venture
d) Committee

Type of business enterprise that protect memebers against losing all of their personal wealth; members are taxed as if they were in a partnership:
a) Limited liability company (LLC)
b) Limited partnership
c) Joint Venture
d) Sole proprietorship

Private or government funded agency that assists new businesses by providing advice or low rent building and supplies:
a) Small-business incubator
b) Startup
c) Partnership
d) Proprietor

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