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Jonathan serves on Foot Locker's board of directors.How did Jonathan get this position?


A) He volunteered for the assignment.
B) He was appointed by the chief executive officer.
C) He was assigned by the Federal Trade Commission.
D) Through default as the largest stockholder,Wade got the position.
E) He was elected by the company's stockholders.

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As with a sole proprietorship,one disadvantage of a partnership is a lack of continuity.

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Because of limited liability,individuals are more willing to invest in corporations than in other forms of business.

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When Compaq and Hewlett-Packard decided to become one company,this was an example of a(n)


A) acquisition.
B) hostile takeover.
C) horizontal merger.
D) conglomerate merger.
E) joint venture.

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In the United States,approximately 72 percent of all businesses are


A) corporations.
B) partnerships.
C) sole proprietorships.
D) joint ventures.
E) franchises.

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With respect to combined business skills and knowledge,which of the following partnerships is best?


A) Mary,Janet,and Liz own a bakery.They are able bakers by trade.Each wants to spend all of his time baking items.
B) Leslie,Andrea,and Jamieown a boutique.Leslie has marketing expertise.Andrea has ten years' experience operating a successful small store,including hiring employees,handling inventory control,buying,and managing credit.Jamie is a CPA.Each has agreed to use his or her experience and expertise for the success of the business.
C) Courtney and Bob,both young pharmacists,own a pharmacy.Neither has taken a business course,but they are willing to learn.
D) Jack and Reena own a video store.Reena is most experienced as a homemaker and mother.Jack has worked as an auto mechanic for ten years.
E) Cory and Dany own a vacuum cleaner store.Cory knows everything possible about store operations.Dany is wealthy and can provide investment capital.

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What is the difference between a joint venture and a syndicate?

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A joint venture is an agreement between ...

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Nortons,Inc.is a hardware store that is owned by members of the Norton family as well as a few close friends of the family.This company is a(n)


A) sole proprietorship.
B) partnership.
C) open corporation.
D) closed corporation.
E) public corporation.

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Which of the following is not a disadvantage of sole proprietorships?


A) Unlimited liability
B) Lack of money
C) Double taxation
D) Lack of continuity
E) Limited management skills

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How does an S-corporation differ from a limited-liability company? Does an LLC type of ownership appeal to you? Explain your answer.

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A limited-liability corporation (LLC)is ...

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Nick wants to make money,so he starts his own business as a sole proprietor.He likes this form of business because


A) he will get to keep all of the profits the business makes.
B) profit is guaranteed since he will be the only owner.
C) it will provide a steady income for him.
D) he has to split the profits with only one other person.
E) he has to pay small dividends to the other owners.

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B&G,Inc. ​A year ago,Carl went to work for B&G,Inc.He has worked for the finance department ever since he started.He noticed that the corporation was only taxed as though it were a partnership.This was something that he found very odd when he first started working for the company,but he later realized it was a fairly common practice.He recognized that this was one of the advantages of this type of corporation. ​While the job was challenging,Carl was not happy.He wanted to work for a company whose main goal was to provide service to the community,not to make a profit.However,Carl felt that,considering his present financial situation,he had to continue working for B&G,Inc.A week later,Carl discovered there was going to be a merger between B&G,Inc.and one of its major competitors.Carl's boss informed him that he would be getting a promotion and a raise.While he was excited about making more money,he still was not happy.He knew then that he would not be working for the company for long. -Refer to B&G,Inc.What type of organization was Carl considering switching to?


A) Limited-liability corporation
B) Sole proprietorship
C) S-corporation
D) Not-for-profit corporation
E) Closed corporation

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Which of the following is not a disadvantage of the corporate form of ownership?


A) Difficulty of formation
B) Limited liability
C) Expense of incorporation and selling stock
D) Lack of secrecy
E) Double taxation

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Which of the following is an advantage of a sole proprietorship?


A) The owner has unlimited liability.
B) The business ceases to exist when the owner dies.
C) There is a limit to the amount one person can borrow.
D) Profits are taxed as individual income.
E) The owner enjoys lack of continuity.

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Business analysts were reviewing the sales statistics for two companies with the goal of determining which company would be the best for investment purposes.Company A had annual profits of $1 million a year at its five-year mark with profits increasing annually for five additional years to profits of $1.2 million.Company B had annual profits of $10,000 at its five-year mark,but profits increased annually for five additional years to $100,000 with these numbers climbing annually.Which of the following is most likely in light of these profit figures?


A) Company A has greater access to capital than Company B.
B) Company A has most likely expanded its operations over five years by selling new items or selling in new markets.
C) The leadership of Company B has less status than Company A.
D) Company A has greater sales than Company B.

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A tender offer is an offer to purchase stock from existing stockholders.

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What do experts believe is likely to become one of the most popular types of business organizations?


A) Limited-liability companies
B) S-corporations
C) Partnerships
D) Sole proprietorships
E) Corporations

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What does it mean when someone says that a corporation is an artificial person created by law? In your answer,describe some things that an artificial person and a real person like you could both do.

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In an 1819 Supreme Court decision,Chief ...

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The retail card and gift shop chain that Bria started has since been incorporated.Which of the following best describes the limited liability that Bria has as the primary stockholder in this corporation?


A) Bria has no responsibility if the business fails and will still be able to get her initial investment back.
B) Bria may have to give up her car and house if the corporation fails in order to cover the debts of the corporation.
C) The other stockholders will be able to seize Bria's personal money but not her primary residence in the event that the business fails.
D) Bria's personal assets will be protected in the event that the corporation fails,although she could lose her entire investment.
E) Bria will only be liable for losses that develop from decisions she made about the daily business operations.

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Logan Nettles approached Kevin Lang about becoming a partner in a firm that destroys environmental waste.While Logan would like to become a partner in the firm,he is concerned about his liability because he has recently inherited a lot of money.In this situation,Logan should become a


A) general partner with a majority ownership interest in the business.
B) general partner with a minority ownership interest in the business.
C) limited partner.
D) joint venturist.
E) sole proprietor.

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