Quiz 2
Question 1 The ________ is the most complex form of ownership and is a separate
legal entity in the eyes of the law.
Question 2 The most critical disadvantage of the sole
proprietorship is:
Question 3 A significant disadvantage of a partnership is:
Question 4 A limited liability company is formed under:
Question 5 Probably the most important feature of a
partnership agreement is:
Question 6 A corporation receives its authority to operate
from:
Question 7 One major advantage of the ________ is that once
the owner has paid all of the company’s expenses, he/she can keep the remaining
profits (less taxes, of course).
Question 8 A partnership
is:
Question 9 All partnerships must have:
Question 10 Which of the following is a disadvantage of the
corporation form of ownership?
Question 11 Shares the corporation itself owns are called:
Question 12 If a partnership is formed without an agreement,
the partnership is automatically subject to the:
Question 13 ________ corporations have shares that are
controlled by a relatively small number of people – family members, relatives,
or friends.
Question 14 The most common form of business ownership is
the:
Question 15 A corporation doing business in the state in
which it is incorporated is considered to be a(n) ________ corporation.
Question 16 When buying a franchise, the potential
franchisee should first:
Question 17 The primary advantage of buying a franchise over
starting your own company is:
Question 18 Franchise advertising programs:
Question 19 ________ franchising involves the owner of an
existing business becoming a franchisee to gain the advantage of name recognition.
Question 20 When the franchisee has the right to establish a
semi-independent organization in a particular territory to recruit, sell, and
support other franchises, it is called a ________ franchise.
Question 21 There are two main risks in purchasing a
franchise. First, that of the franchiser’s experience and business system, and
second:
Question 22 The most expensive franchises in terms of total
investment are:
Question 23 Most franchise experts consider the most
important factor in the success of a franchise to be:
Question 24 The ________ requires all franchisers to
disclose detailed information on their operations at the first personal meeting
or at least fourteen days before a franchise contract is signed or any money is
paid.
Question 25 The most litigated subject of the franchisee
agreement is:
Question 26 ________ franchising involves providing the
franchisee with a complete business system–the established name, the building
layout and design, accounting systems, etc.
Question 27 In view of the cause of most new business
failures, probably the most valuable service provided franchisees by the
franchiser is:
Question 28 In franchising, ________ pay fees and royalties
to a ________ in return for the right to sell its products or services under
the franchiser’s trade name and often to use its business format and system.
Question 29 Another term for cobranding franchising is:
Question 30 When it
comes to purchasing products, equipment, etc., the franchiser:
