BUSINESS ADMINISTRATION
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of these is not a disadvantage of Sole Proprietorship
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Unlimited liability
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Easy raising capital
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The small size of Sole Proprietorship
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Limited managerial experience
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Explanation:
Detailed explanation-1: -The most significant disadvantage of the sole proprietorship is no protection from liability. Every business liability is a personal liability since there is no legal entity concept. So, while the owners have the freedom to control and make decisions independently, they are also solely liable for the business.
Detailed explanation-2: -Difficulty Raising Capital-Because there are no shares of stock or membership interests to sell, sole proprietors have a difficult time raising capital from investors. Banks and other lenders are also sometimes hesitant to lend to sole proprietors.
There is 1 question to complete.