Types Of Business Ownership! Trivia Quiz

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| By Lisahl

Lisahl

Community Contributor

Quizzes Created: 1 | Total Attempts: 2,388

Questions: 9 | Attempts: 2,388 | Updated: Mar 21, 2023

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Questions and Answers

1.

An LLC (limited liability company) is a hybrid of two types of business ownerships below.
- A.
  
  Partnership
- B.
  
  Franchise
- C.
  
  Sole Proprietorship
- D.
  
  Corporation
- E.
  
  Cooperative
Correct Answer(s)
A. Partnership
D. Corporation

Explanation
An LLC is a hybrid of two types of business ownerships: Partnership and Corporation. A partnership is a business owned by two or more individuals who share profits and liabilities. A corporation, on the other hand, is a legal entity separate from its owners, providing limited liability protection. An LLC combines the flexibility and tax benefits of a partnership with the limited liability protection of a corporation, making it an attractive option for many small businesses.

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2.

Which type of ownership below has limited liability for its owners?
- A.
  
  Sole Proprietorship
- B.
  
  Corporation
- C.
  
  Partnership
Correct Answer
B. Corporation

Explanation
A corporation is the type of ownership that has limited liability for its owners. This means that the owners, also known as shareholders, are not personally responsible for the company's debts or legal obligations. In the event of bankruptcy or lawsuits, the shareholders' personal assets are protected, and they can only lose the amount they have invested in the corporation. This limited liability feature makes corporations an attractive option for investors and entrepreneurs looking to protect their personal finances.

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3.

Which of the following is NOT a characteristic of a sole proprietorship?
- A.
  
  Unlimited liability
- B.
  
  You are the boss!
- C.
  
  You keep most of the profits
- D.
  
  Business does not end when the owner dies
Correct Answer
D. Business does not end when the owner dies

Explanation
A sole proprietorship is a type of business entity where the owner is personally liable for all debts and obligations of the business. This means that the owner's personal assets can be used to satisfy business debts. Additionally, the owner has complete control and decision-making authority over the business, making them the boss. They also get to keep most of the profits earned by the business. However, one characteristic that is not true for a sole proprietorship is that the business does not end when the owner dies. In fact, the business is considered to be an extension of the owner, and therefore, it typically ceases to exist upon the owner's death.

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4.

Hawaiian Humane Society provides services for animals.
- A.
  
  At a high profit margin
- B.
  
  For no proft
Correct Answer
B. For no proft

Explanation
The explanation for the given correct answer is that the Hawaiian Humane Society provides services for animals "for no profit." This means that they do not aim to make money from their services, but rather their main goal is to provide assistance and support to animals in need. They likely rely on donations, grants, and other forms of funding to cover their expenses and continue their work in helping animals.

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5.

Which of the following are NOT franchises?
- A.
  
  Taco Bell
- B.
  
  Nike
- C.
  
  McDonalds
- D.
  
  Subway
Correct Answer
B. Nike

Explanation
Nike is not a franchise because it is not a business model that allows individuals to purchase and operate their own Nike store or business. Nike operates its own stores and sells its products through authorized retailers, but it does not offer franchise opportunities like Taco Bell, McDonald's, and Subway do.

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6.

Which of the following is an example of a cooperative discussed in class?
- A.
  
  Florida apple farmers
- B.
  
  Florida cranberry farmers
- C.
  
  Florida orange farmers
Correct Answer
C. Florida orange farmers

Explanation
Florida orange farmers is an example of a cooperative discussed in class because a cooperative is an organization formed by a group of individuals with similar interests or goals, who come together to pool their resources and efforts for mutual benefit. In this case, the Florida orange farmers work together to share resources, knowledge, and marketing strategies, allowing them to collectively improve their production and sales of oranges.

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7.

Which items fit the description of a partnership type of business ownership?
- A.
  
  More money
- B.
  
  Limited liability
- C.
  
  More Skills
- D.
  
  Possibility of arguments
Correct Answer(s)
A. More money
C. More Skills
D. Possibility of arguments

Explanation
A partnership type of business ownership involves multiple individuals pooling their resources and skills to run a business together. "More money" implies that partners contribute their own capital to the business, while "More Skills" suggests that partners bring different expertise and abilities to the table. "Possibility of arguments" acknowledges that disagreements and conflicts can arise between partners due to differing opinions and interests. Limited liability, which is not mentioned in the answer choices, is a characteristic of a corporation rather than a partnership.

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8.

In a corporation....
- A.
  
  The company does not die when the owner dies
- B.
  
  The company shuts down when the owner dies
Correct Answer
A. The company does not die when the owner dies

Explanation
In a corporation, the company does not die when the owner dies because a corporation is a separate legal entity from its owners. It has its own rights and liabilities, and its existence is not dependent on the life of its owners. Even if the owner or shareholders pass away, the corporation can continue to operate and be transferred to new owners or shareholders. This is one of the advantages of incorporating a business, as it provides continuity and stability even in the event of the owner's death.

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9.

Which items are cons to having a corporation?
- A.
  
  Double taxation
- B.
  
  Creating capital through stocks
- C.
  
  Government regulation
- D.
  
  Limited liability
Correct Answer(s)
A. Double taxation
C. Government regulation

Explanation
Having a corporation can have certain disadvantages, or cons. One of these is double taxation, which means that the corporation's profits are taxed at both the corporate level and the individual level when distributed to shareholders as dividends. This can result in a higher overall tax burden for the corporation and its shareholders. Additionally, government regulation is another con of having a corporation. Corporations are subject to various regulations imposed by the government, which can increase compliance costs and restrict certain business activities.

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Current Version
Mar 21, 2023

Quiz Edited by
ProProfs Editorial Team
Aug 27, 2010

Quiz Created by
Lisahl

Types Of Business Ownership! Trivia Quiz

An LLC (limited liability company) is a hybrid of two types of business ownerships below.

Which type of ownership below has limited liability for its owners?

Which of the following is NOT a characteristic of a sole proprietorship?

Hawaiian Humane Society provides services for animals.

Which of the following are NOT franchises?

Which of the following is an example of a cooperative discussed in class?

Which items fit the description of a partnership type of business ownership?

In a corporation....

Which items are cons to having a corporation?