GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Disadvantages include unlimited liability, difficult to raise financial capital, difficulty attracting qualified employees, limited life
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Sole Propriotorship
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Bananas
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Corporation
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Franchise
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Explanation:
Detailed explanation-1: -Unlimited liability. Difficulty raising capital. Limited managerial expertise. Trouble finding qualified employees. Personal time commitment. Unstable business life. Losses are the owner’s responsibility.
Detailed explanation-2: -The reason business owners of sole proprietorships and partnerships are subject to unlimited liability is because both business structures do not create a separate legal entity. The owners and the business are one entity.
Detailed explanation-3: -Two disadvantages of a proprietorship are (1) the relative difficulty of raising new capital and (2) the owner’s unlimited personal liability for the business’ debts.
There is 1 question to complete.