ECONOMICS
ENTREPRENEURS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The proprietor may not have all the skills needed to run the business.
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Most new businesses require a lot of money to start, this could be more than one owner can provide.
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The risk can be great and must be carried by the proprietor, includes personal liability.
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The proprietor receives all profits from the operation of the business.
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Detailed explanation-1: -Advantages of a sole proprietorship Sole proprietorships are easy to establish and get started. The owner retains complete control of the business. There are no corporate income tax payments. They are less expensive than other business types.
Detailed explanation-2: -Sole proprietorship has the following advantage: Ease of starting a business, being your own boss, a pride of ownership, quick decision, direct incentive, confidentiality of information.
Detailed explanation-3: -limited liability. A corporation is a separate legal entity and shareholders are only liable to the extent of their ownership. This limited liability feature provides a corporation an advantage over sole proprietorships and partnerships which do not enjoy such protections.
Detailed explanation-4: -Answer and Explanation: It is correct that b) the owner of a sole proprietorship is personally responsible for all the company’s debts. A sole proprietorship allows an individual to do business but does not distinguish the business from the business owner.