Multiple Choice
Identify the
letter of the choice that best completes the statement or answers the question.
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1.
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A written legal document defining ownership and operating procedures and
conditions for a corporation is called the
a. | partnership agreement. | b. | articles of confederation. | c. | corporate code of
ethics. | d. | articles of incorporation. |
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2.
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All of the following are examples of producers, except:
a. | farmers | c. | manufacturers | b. | extractors | d. | fast food
restaurant |
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3.
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Proprietorships
a. | account for the largest percentage of business revenues in the
U.S. | b. | are owned and controlled by two or more people who have entered into a written
agreement. | c. | are the easiest form of business to start. | d. | protect the
liability of the business owners to only the amount of money they have invested directly in the
business. |
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4.
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The people who make the major policy and financial decisions for a corporation
are called the
a. | stockholders. | b. | partners. | c. | board of
directors. | d. | owners. |
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5.
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A special form of business organization that combines advantages of a
corporation and a partnership is a:
a. | franchise | c. | limited liability company | b. | cooperative | d. | nonprofit corporation |
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6.
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Of the MAJOR forms business ownership in the U.S., which is the MOST
common?
a. | corporation | b. | partnership | c. | franchise | d. | proprietorship |
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7.
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Which form of ownership is the most popular in the United States?
a. | sole proprietorship | c. | partnership | b. | S-corporation | d. | corporation |
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8.
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All are examples of intermediaries except:
a. | Giant Food Stores | c. | Karoly Law Offices | b. | Sam’s Club | d. | BJ’s Wholesale
Club |
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9.
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All of the following are advantages to a corporation except:
a. | easily expanded | c. | limited liability | b. | double taxation | d. | they can issue shares of stock to generate
money. |
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10.
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All are examples of franchises except:
a. | McDonalds | c. | MAACO Auto Painting | b. | Dell | d. | Jiffy Lube |
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True/False
Indicate whether the
sentence or statement is true or false.
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11.
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In a partnership, each partner is liable for all debts of the business should if
fail.
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12.
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A retailer is an example of a producer.
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13.
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The three major types of businesses are categorized into service, producers, and
intermediaries.
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14.
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In order to create a corporation, the potential business must request a charter
from the state.
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15.
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The people who make the major policy and financial decisions in a corporation
are the board of directors.
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16.
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If Courtney buys a McDonald’s franchise, she is known as the
franchisee.
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17.
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Mr. Lane’s grass cutting business is a corporation.
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18.
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Most U.S. businesses are quite small, having no employees other than the
owners.
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19.
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The term baby boomers refers to the number of people born between 1946 and
1964.
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20.
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The form of ownership that gives one person sole control over all business
decisions is the partnership.
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