Question 1

Because of unlimited liability,it is easy for sole proprietors to borrow large sums of money.

Accepted Answer

A) True 
 B)False

Question 2

The most effective form of business organization for raising capital is the

Accepted Answer

A)   joint venture.
B)   syndicate.
C)   sole proprietorship.
D)   partnership.
E)   corporation.F) B) and C)
G) A) and D)

Question 3

To gain access to one another's markets,several U.S.and Japanese automobile manufacturers (for example,Chrysler and Mitsubishi) are engaging in temporary alliances to manufacture and market certain models of cars.These types of partnerships are known as

Accepted Answer

A)   limited-liability companies.
B)   S-corporations.
C)   cooperatives.
D)   joint ventures.
E)   foreign corporations.F) A) and E)
G) C) and E)

Question 4

Hector is considering expanding his business and has several potential new investors in mind.He originally wanted to form an S-corporation to protect the liability of the investors,but he is now considering a limited-liability company instead because he knows there can be only ____ stockholders in an S-corporation.

Accepted Answer

A)   10
B)   25
C)   50
D)   100
E)   108F) C) and D)
G) A) and E)

Question 5

What are some of the disadvantages of partnerships? Are the disadvantages enough to dissuade you from forming this type of business ownership?

Accepted Answer

Answers will vary.Disadvantages of the p...

Question 6

Explain the differences among a domestic,a foreign,and an alien corporation.

Accepted Answer

A domestic corporation is an incorporate...

Question 7

A voluntary association of two or more people acting as co-owners of a business is known as a partnership.

Accepted Answer

A) True 
 B)False

Question 8

Describe the array of advantages of a corporation.

Accepted Answer

Limited liability is an important advant...

Question 9

Describe the merger trends affecting American business.

Accepted Answer

Most experts predict that mergers and ac...

Question 10

An S-corporation can have no more than twenty stockholders.

Accepted Answer

A) True 
 B)False

Question 11

Walmart is incorporated in Arkansas,the state of its origins and headquarters.Within Arkansas,Walmart is classified as a(n) ____ corporation.

Accepted Answer

A)   privately-held
B)   foreign
C)   alien
D)   domestic
E)   hometownF) All of the above
G) A) and C)

Question 12

According to the text,which of the following statements is false?

Accepted Answer

A)   The sole proprietor is often the sole manager.
B)   Many sole proprietors cannot afford to hire the help they need.
C)   Potential employees often feel there is no room for advancement in a sole proprietorship.
D)   When compared to larger businesses,the lure of employee benefits is one reason why people go to work for sole proprietorships.
E)   The sole proprietor often finds it hard to keep competent employees.F) C) and D)
G) All of the above

Question 13

Legally,a partnership must

Accepted Answer

A)   have at least one limited partner.
B)   have at least one general partner.
C)   make all owners general partners.
D)   not have any general partners.
E)   designate a limited partner to be responsible for all debts of the partnership.F) A) and B)
G) All of the above

Question 14

Tyler would like to own a train store and operate it by himself.He has enough money to open it and operate it on his own and elects to do so.What form of business is this?

Accepted Answer

A)   Sole proprietorship.
B)   Partnership.
C)   LLC.
D)   S-corporation.E) All of the above
F) None of the above

Question 15

Corporations account for about 82 percent of all sales revenues.

Accepted Answer

A) True 
 B)False

Question 16

When compared to partnerships and corporations,sole proprietorships account for ____ percent of total annual sales.

Accepted Answer

A)   34
B)   16
C)   9
D)   4
E)   2F) D) and E)
G) C) and E)

Question 17

Which of the following is an example of a horizontal merger?

Accepted Answer

A)   The purchase of a catering firm by Delta Airlines
B)   The purchase of Marathon Oil Company by U.S.Steel
C)   The purchase of Kentucky Fried Chicken by PepsiCo
D)   The purchase of Sam's Meat Packing Company by the Kroger supermarket chain
E)   The purchase of Mobil Oil by ExxonF) C) and E)
G) A) and E)

Question 18

Twenty-five young investors decided that they want to start a dating service;however,they do not want to be held personally liable for losses of the company.They want to avoid double taxation.Which type of business organization would best fit the needs of these individuals?

Accepted Answer

A)   Corporation
B)   Closed corporation
C)   Partnership
D)   S-corporation
E)   Limited cooperativeF) C) and D)
G) A) and D)

Question 19

All corporations operate primarily for profit.

Accepted Answer

A) True 
 B)False

Question 20

Phillip and Dwight have sold stock to eight of their friends and have enough money to expand the business and to open another store.During a shareholders' meeting,Phillip,Dwight,and the eight other shareholders unanimously agreed that it would be better to pass through the company's profits and losses like a partnership.All of the shareholders are individuals and United States citizens.The shareholders could vote to change the corporation into a(n)

Accepted Answer

A)   S-corporation.
B)   limited liability company.
C)   alien corporation.
D)   foreign corporation.E) B) and C)
F) C) and D)

Exam 4: Choosing a Form of Business Ownership

Correct Answer
verified

Describe the array of advantages of a corporation.

Correct Answer
verified
Limited liability is an important advant...
View Answer

Tyler would like to own a train store and operate it by himself.He has enough money to open it and operate it on his own and elects to do so.What form of business is this?

Correct Answer
verified

Explain the differences among a domestic,a foreign,and an alien corporation.

Correct Answer
verified
A domestic corporation is an incorporate...
View Answer

Because of unlimited liability,it is easy for sole proprietors to borrow large sums of money.

Correct Answer
verified

According to the text,which of the following statements is false?

Correct Answer
verified

What are some of the disadvantages of partnerships? Are the disadvantages enough to dissuade you from forming this type of business ownership?

Correct Answer
verified
Answers will vary.Disadvantages of the p...
View Answer

A voluntary association of two or more people acting as co-owners of a business is known as a partnership.

Correct Answer
verified

Twenty-five young investors decided that they want to start a dating service;however,they do not want to be held personally liable for losses of the company.They want to avoid double taxation.Which type of business organization would best fit the needs of these individuals?

Correct Answer
verified

Correct Answer
verified

Legally,a partnership must

Correct Answer
verified

Which of the following is an example of a horizontal merger?

Correct Answer
verified

Walmart is incorporated in Arkansas,the state of its origins and headquarters.Within Arkansas,Walmart is classified as a(n) ____ corporation.

Correct Answer
verified

All corporations operate primarily for profit.

Correct Answer
verified

Describe the merger trends affecting American business.

Correct Answer
verified
Most experts predict that mergers and ac...
View Answer

The most effective form of business organization for raising capital is the

Correct Answer
verified

When compared to partnerships and corporations,sole proprietorships account for ____ percent of total annual sales.

Correct Answer
verified

An S-corporation can have no more than twenty stockholders.

Correct Answer
verified

Corporations account for about 82 percent of all sales revenues.

Correct Answer
verified

To gain access to one another's markets,several U.S.and Japanese automobile manufacturers (for example,Chrysler and Mitsubishi) are engaging in temporary alliances to manufacture and market certain models of cars.These types of partnerships are known as

Correct Answer
verified

Exam 4: Choosing a Form of Business Ownership

Correct AnswerverifiedShow Answer

Describe the array of advantages of a corporation.

Correct AnswerverifiedLimited liability is an important advant...View AnswerShow Answer

Tyler would like to own a train store and operate it by himself.He has enough money to open it and operate it on his own and elects to do so.What form of business is this?

Correct AnswerverifiedShow Answer

Explain the differences among a domestic,a foreign,and an alien corporation.

Correct AnswerverifiedA domestic corporation is an incorporate...View AnswerShow Answer

Because of unlimited liability,it is easy for sole proprietors to borrow large sums of money.

Correct AnswerverifiedShow Answer

According to the text,which of the following statements is false?

Correct AnswerverifiedShow Answer

What are some of the disadvantages of partnerships? Are the disadvantages enough to dissuade you from forming this type of business ownership?

Correct AnswerverifiedAnswers will vary.Disadvantages of the p...View AnswerShow Answer

A voluntary association of two or more people acting as co-owners of a business is known as a partnership.

Correct AnswerverifiedShow Answer

Twenty-five young investors decided that they want to start a dating service;however,they do not want to be held personally liable for losses of the company.They want to avoid double taxation.Which type of business organization would best fit the needs of these individuals?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Legally,a partnership must

Correct AnswerverifiedShow Answer

Which of the following is an example of a horizontal merger?

Correct AnswerverifiedShow Answer

Walmart is incorporated in Arkansas,the state of its origins and headquarters.Within Arkansas,Walmart is classified as a(n) ____ corporation.

Correct AnswerverifiedShow Answer

All corporations operate primarily for profit.

Correct AnswerverifiedShow Answer

Describe the merger trends affecting American business.

Correct AnswerverifiedMost experts predict that mergers and ac...View AnswerShow Answer

The most effective form of business organization for raising capital is the

Correct AnswerverifiedShow Answer

When compared to partnerships and corporations,sole proprietorships account for ____ percent of total annual sales.

Correct AnswerverifiedShow Answer

An S-corporation can have no more than twenty stockholders.

Correct AnswerverifiedShow Answer

Corporations account for about 82 percent of all sales revenues.

Correct AnswerverifiedShow Answer

To gain access to one another's markets,several U.S.and Japanese automobile manufacturers (for example,Chrysler and Mitsubishi) are engaging in temporary alliances to manufacture and market certain models of cars.These types of partnerships are known as

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
Limited liability is an important advant...
View Answer

Correct Answer
verified

Correct Answer
verified
A domestic corporation is an incorporate...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Answers will vary.Disadvantages of the p...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Most experts predict that mergers and ac...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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