Business Structures – Flashcards
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An entrepreneur who opens a franchise must
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NOT select sites
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Cooperatives save members money by
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NOT sharing all profits democratically as a group.
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Entrepreneurs who want to open a franchise
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buy the rights from the parent company and invest in a location approved by the parent company.
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A disadvantage of forming a partnership is that owners
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are fully responsible for their partners' losses.
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Which document determines the number of shares a company can sell?
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NOT a stock prospectus
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How do corporations raise money and resources to expand?
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They agree to sell stocks.
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Which best describes the difference between sole proprietorships and partnerships?
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Sole proprietors keep all profits and have unlimited liability, while partners split profits and share liabilities.
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Franchising is typically done by
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corporations
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Which describes the process of how a business incorporates?
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The business must gain government permission and issue a stock sale, followed by a shareholder vote.
