Question 1

Identify and describe three advantages of general partnerships as a form of business ownership.

Accepted Answer

Ability to pool financial resources: Wit

Question 2

Which form of business ownership offers its owners limited liability?

Accepted Answer

A)  sole proprietorship 
B)  partnership 
C)  corporation 
A)  sole proprietorship 
B)  partnership 
C)  corporation

Question 3

In an acquisition, what do we call the firm being purchased?

Accepted Answer

A)  the acquiring firm 
B)  the target firm 
C)  the limited liability partnership 
D)  the merged firm 
A)  the acquiring firm 
B)  the target firm 
C)  the limited liability partnership 
D)  the merged firm

Question 4

Which of the following is a form of business ownership that is considered to be separate from its owners, who are known as shareholders?

Accepted Answer

A)  sole proprietorship 
B)  corporation 
C)  general partnership 
D)  limited partnership 
A)  sole proprietorship 
B)  corporation 
C)  general partnership 
D)  limited partnership

Question 5

A conglomerate merger is a combination of two firms in unrelated industries.

Accepted Answer

A) True 
 B)False

Question 6

What is the term for when one firm buys another firm?

Accepted Answer

A)  acquisition 
B)  conglomeration 
C)  joint venture 
D)  merger 
A)  acquisition 
B)  conglomeration 
C)  joint venture 
D)  merger

Question 7

Which of the following is a serious drawback of sole proprietorships?

Accepted Answer

A)  They are heavily regulated by the federal government. 
B)  They expose their owners to unlimited liability for the company's debts. 
C)  They are difficult and inexpensive to form. 
D)  They result in double taxation of the company's earnings. 
A)  They are heavily regulated by the federal government. 
B)  They expose their owners to unlimited liability for the company's debts. 
C)  They are difficult and inexpensive to form. 
D)  They result in double taxation of the company's earnings.

Question 8

What are the three types of partnerships?

Accepted Answer

A)  specific, general, and generic 
B)  general, unlimited, and general liability 
C)  general, limited, and limited liability 
D)  sole, general, and specific 
A)  specific, general, and generic 
B)  general, unlimited, and general liability 
C)  general, limited, and limited liability 
D)  sole, general, and specific

Question 9

What is the type of merger where two or more firms at different stages of production of a given product or service are combined so the firms have a buyer-seller relationship?

Accepted Answer

A)  an upward merger 
B)  a horizontal merger 
C)  a vertical merger 
D)  a conglomerate merger 
A)  an upward merger 
B)  a horizontal merger 
C)  a vertical merger 
D)  a conglomerate merger

Question 10

Which of the following is a voluntary agreement between two or more people to jointly own a business?

Accepted Answer

A)  partnership 
B)  corporation 
C)  limited liability partnership 
D)  sole proprietorship 
A)  partnership 
B)  corporation 
C)  limited liability partnership 
D)  sole proprietorship

Question 11

Which of the following is a disadvantage of corporations as a form of business ownership?

Accepted Answer

A)  Their owners have unlimited liability. 
B)  They have very limited ability to raise financial resources. 
C)  Any earnings they distribute to shareholders are subject to double taxation. 
D)  They lack permanence, since in most provinces corporate charters are only valid for 40 years. 
A)  Their owners have unlimited liability. 
B)  They have very limited ability to raise financial resources. 
C)  Any earnings they distribute to shareholders are subject to double taxation. 
D)  They lack permanence, since in most provinces corporate charters are only valid for 40 years.

Question 12

What is the definition of a conglomerate acquisition?

Accepted Answer

A)  combination of firms in the same industry 
B)  combination of firms at different stages in the production of a given good or service so that the firms have a buyer-seller relationship 
C)  combination of firms in unrelated industries 
D)  combination of firms selling conglomerate products 
A)  combination of firms in the same industry 
B)  combination of firms at different stages in the production of a given good or service so that the firms have a buyer-seller relationship 
C)  combination of firms in unrelated industries 
D)  combination of firms selling conglomerate products

Question 13

Explain why general corporations have become the dominant form of business ownership.

Accepted Answer

General corporations are businesses that

Question 14

Franchising is a contractual relationship in which an established business entity allows others to operate a business using the unique resources it supplies in exchange for monetary payments and other considerations.

Accepted Answer

A) True 
 B)False

Question 15

Describe how a corporation is formed.

Accepted Answer

Forming a corporation is more complex th

Question 16

Which of the following occurs when two or more companies agree to a combination of equals, creating one new company from the two previously independent companies?

Accepted Answer

A)  corporate integration 
B)  industrial concentration 
C)  merger 
D)  amalgamation 
A)  corporate integration 
B)  industrial concentration 
C)  merger 
D)  amalgamation

Question 17

Which of the following might be one of the services a franchisor would provide to a franchisee?

Accepted Answer

A)  selling products to customers 
B)  site selection 
C)  startup money 
D)  hiring employees 
A)  selling products to customers 
B)  site selection 
C)  startup money 
D)  hiring employees

Question 18

In an acquisition, the firm who is doing the buying is called the target firm.

Accepted Answer

A) True 
 B)False

Question 19

The sole proprietorship is subject to double taxation in that any earnings are taxed both as income to the business and as income to the owner of the business.

Accepted Answer

A) True 
 B)False

Question 20

Dana wants to open her own business after completing college. As a fine arts student, she is planning to provide services as a graphic artist. Although she is nervous about risking her personal assets, she is thinking about forming a proprietorship. Which of the following provides the best advice for Dana?

Accepted Answer

A)  Forming a sole proprietorship can help you protect your personal assets, but it is a poor choice for individuals who want to be their own boss because this form of business is heavily regulated. 
B)  Forming a sole proprietorship is a great idea. It gives you the ability to be your own boss while also protecting your personal assets from loss. 
C)  Forming a sole proprietorship is a bad choice. Not only is a sole proprietorship subject to extensive government regulation that will limit your ability to run your business, it also exposes you to unlimited liability. 
D)  Forming a sole proprietorship will enable you to be your own boss. But if you are really nervous about risking your personal assets, you might want to consider some other form of ownership because it will also expose you to unlimited liability. 
A)  Forming a sole proprietorship can help you protect your personal assets, but it is a poor choice for individuals who want to be their own boss because this form of business is heavily regulated. 
B)  Forming a sole proprietorship is a great idea. It gives you the ability to be your own boss while also protecting your personal assets from loss. 
C)  Forming a sole proprietorship is a bad choice. Not only is a sole proprietorship subject to extensive government regulation that will limit your ability to run your business, it also exposes you to unlimited liability. 
D)  Forming a sole proprietorship will enable you to be your own boss. But if you are really nervous about risking your personal assets, you might want to consider some other form of ownership because it will also expose you to unlimited liability.

Identify and describe three advantages of general partnerships as a form of business ownership.

Which form of business ownership offers its owners limited liability?

In an acquisition, what do we call the firm being purchased?

Which of the following is a form of business ownership that is considered to be separate from its owners, who are known as shareholders?

A conglomerate merger is a combination of two firms in unrelated industries.

What is the term for when one firm buys another firm?

Which of the following is a serious drawback of sole proprietorships?

What are the three types of partnerships?

What is the type of merger where two or more firms at different stages of production of a given product or service are combined so the firms have a buyer-seller relationship?

Which of the following is a voluntary agreement between two or more people to jointly own a business?

Which of the following is a disadvantage of corporations as a form of business ownership?

What is the definition of a conglomerate acquisition?

Explain why general corporations have become the dominant form of business ownership.

Franchising is a contractual relationship in which an established business entity allows others to operate a business using the unique resources it supplies in exchange for monetary payments and other considerations.

Describe how a corporation is formed.

Which of the following occurs when two or more companies agree to a combination of equals, creating one new company from the two previously independent companies?

Which of the following might be one of the services a franchisor would provide to a franchisee?

In an acquisition, the firm who is doing the buying is called the target firm.

The sole proprietorship is subject to double taxation in that any earnings are taxed both as income to the business and as income to the owner of the business.

Business Now: Change Is the Only Constant

Business Ethics and Social Responsibility: Doing Well by Doing Good

Economics: The Framework for Business

The World Market-Place: Business Without Borders

Small Business and Entrepreneurship: Economic Rocket Fuel

Accounting: Decision Making by the Numbers

Finance: Acquiring and Using Funds to Maximize Value

Financial Markets: Allocating Financial Resources

Marketing: Building Profitable Customer Connections

Product and Promotion: Creating and Communicating Value

Distribution and Pricing: Right Product, Right Person, Right Place, Right Price

Management, Motivation, and Leadership: Bringing Business to Life

Human Resource Management: Building a Top-Quality Workforce

Managing Information and Technology: Finding New Ways to Learn and Link

Operations Management: Putting It All Together

Business Communication: Creating and Delivering Messages That Matter

Labour Unions and Collective Bargaining

Business Law

Personal Finance

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Exam 5: Business Formation: Choosing the Form That Fits

Identify and describe three advantages of general partnerships as a form of business ownership.

Which form of business ownership offers its owners limited liability?

In an acquisition, what do we call the firm being purchased?

Which of the following is a form of business ownership that is considered to be separate from its owners, who are known as shareholders?

A conglomerate merger is a combination of two firms in unrelated industries.

What is the term for when one firm buys another firm?

Which of the following is a serious drawback of sole proprietorships?

What are the three types of partnerships?

What is the type of merger where two or more firms at different stages of production of a given product or service are combined so the firms have a buyer-seller relationship?

Which of the following is a voluntary agreement between two or more people to jointly own a business?

Which of the following is a disadvantage of corporations as a form of business ownership?

What is the definition of a conglomerate acquisition?

Explain why general corporations have become the dominant form of business ownership.

Franchising is a contractual relationship in which an established business entity allows others to operate a business using the unique resources it supplies in exchange for monetary payments and other considerations.

Describe how a corporation is formed.

Which of the following occurs when two or more companies agree to a combination of equals, creating one new company from the two previously independent companies?

Which of the following might be one of the services a franchisor would provide to a franchisee?

In an acquisition, the firm who is doing the buying is called the target firm.

The sole proprietorship is subject to double taxation in that any earnings are taxed both as income to the business and as income to the owner of the business.

Business Now: Change Is the Only Constant

Business Ethics and Social Responsibility: Doing Well by Doing Good

Economics: The Framework for Business

The World Market-Place: Business Without Borders

Small Business and Entrepreneurship: Economic Rocket Fuel

Accounting: Decision Making by the Numbers

Finance: Acquiring and Using Funds to Maximize Value

Financial Markets: Allocating Financial Resources

Marketing: Building Profitable Customer Connections

Product and Promotion: Creating and Communicating Value

Distribution and Pricing: Right Product, Right Person, Right Place, Right Price

Management, Motivation, and Leadership: Bringing Business to Life

Human Resource Management: Building a Top-Quality Workforce

Managing Information and Technology: Finding New Ways to Learn and Link

Operations Management: Putting It All Together

Business Communication: Creating and Delivering Messages That Matter

Labour Unions and Collective Bargaining

Business Law

Personal Finance

Filters