T/F
Questions
1
Annie owns 100 shares of stock in the
Samson Electricals Corporation, but as a stockholder she does not have the
right to vote in stockholders’ meetings. Annie owns common stock.
Question
2 (1 point)
Owners of limited liability companies are
known as stockholders.
Question
3 (1 point)
Due to low participation among minorities
in franchised businesses, initiatives such as the National Minority Franchising
Initiative are addressing this concern.
Question
4 (1 point)
In terms of total net income,sole
proprietorships are the largest forms of business ownership.
Question
5 (1 point)
In a general partnership, each partner
incurs unlimited liability only for claims resulting from his or her own
negligence.
Question
6 (1 point)
The vast majority of LLCs elect to be taxed
as corporations.
Question
7 (1 point)
In an acquisition, the firm that makes the
purchase is called the target firm.
Question
8 (1 point)
Some states do not permit certain types of
businesses, such as banks, insurance companies, and nonprofit organizations to
operate as LLCs.
Question
9 (1 point)
Examples of institutional investors are
mutual funds, insurance companies, and pension funds.
Question
10 (1 point)
When a general partnership is sued, the
lawsuits often go after the more wealthy partners.
Question
11
As a result of decreased competition and
less saturated markets, McDonald’s foreign franchise outlets in 2014 were
greater than in the United States.
Question
12 (1 point)
Choice of ownership determines the degree
to which each owner has personal liability for the firm’s debts and the sources
of funds available to the firm to finance future expansion.
Question
13 (1 point)
A major advantage of limited liability
partnerships (LLP) is that they offer all partners “full-shield” protection in
every state.
Question
14 (1 point)
A 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.
Question
15 (1 point)
In terms of total number of businesses by
form of ownership, corporations are more common than sole proprietorships.
____________________________________________________________________________________
Multiple
Choice
Compared to a sole proprietorship, a
general partnership:
Question 16 options:
A.has certainty regarding how long a
business will last.
B. is likely to have a stronger financial
base.
C. has limited ability to attract and
maintain employees.
D. is likely to have limited liability.
Question
17 (1 point)
Which of the following is a disadvantage of
a general partnership?
Question 17 options:
A.
A partner who withdraws from a
general partnership cannot be held liable for any debts the firm had at the
time ofwithdrawal.
B.
Compared to the other forms of
ownership, the paperwork and costs involved in forming a general partnership
are the most extensive.
C.
The partners in a general
partnership are exposed to double taxation.
D.
If a current partner withdraws
from a general partnership, the
relationships among the participants will clearly change.
Question
18 (1 point)
Unlike S corporations, limited liability
companies (LLCs):
Question 18 options:
A.
are required to hold regular
board meetings.
B.
can have any number of owners.
C.
have no reporting requirements
D.
cannot include owners who are
foreign investors.
Question
19 (1 point)
A _____ merger is the combination of firms
in the same industry.
Question 19 options:
A.
hostile
B.
conglomerate
C.
vertical
D.
horizontal
Question
20 (1 point)
Rob is an engineer who works in nuclear
power plants. He is considering starting his own engineering company. Due to
the nature of work at his new company, Rob wants to avoid unlimited liability.
Which of the following forms of business ownership is most suitable for Rob?
Question 20 options:
A.
A sole proprietorship
B.
A partnership
C.
A corporation
D.
A sole trader
Question
26 (1 point)
A limited liability partnership (LLP) is
attractive to partners because:
Question 26 options:
A.
all states offer
“full-shield” protection.
B.
there is no distinction between
limited and general partners.
C.
only the partner who provides
the capital has limited liability.
D.
all professional businesses can
form a LLP in any state.
Question
27 (1 point
Tina is the owner of a piano tuning
business. As a sole proprietor, any profit she earns is:
Question 27 options:
A.
taxed twice, once as a business
and then again as Tina’s income.
B.
treated as personal income of
Tina.
C.
not subjected to any tax.
D.
taxed only when she withdraws
the money from a bank.
Question
28 (1 point)
Stockholders are the _____ of a
corporation.
Question 28 options:
A.
creditors
B.
employees
C.
marketers
D.
owners
Question
29 (1 point)
Suzanne was recently elected to the board
of directors at Alliance Bank Corp. As a board member, she is expected to
represent the interests of the bank’s:
Question 29 options:
A.
senior managers.
B.
shareholders.
C.
creditors.
D.
customers.
Question
30 (1 point)
_____ are by far the most common type of
business organizations in the United States.
Question 30 options:
A.
General partnerships
B.
Sole proprietorships
C.
Limited liability companies
D.
Corporations
