Sole traders, partnerships and franchises (chapter 3)

marcela.leme
Quiz by marcela.leme, updated more than 1 year ago
marcela.leme
Created by marcela.leme over 6 years ago
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Description

Quiz on Sole traders, partnerships and franchises (chapter 3), created by marcela.leme on 12/10/2014.

Resource summary

Question 1

Question
Entrepreneurs have many responsibilities. They need to be innovators, risk takers, decision makers and have unlimited liability.
Answer
  • True
  • False

Question 2

Question
Being a sole trader can have many burdens, however there are advantages. Which one of these benefits the sole trader? You may pick one or more.
Answer
  • Have limited liability
  • Simple to set up - no legal requirements
  • Can offer personal service
  • Can exploit economies of scale
  • May qualify for government help

Question 3

Question
Name three disadvantages of having a Partnership.
Answer
  • Financial information is not made public
  • Partners have unlimited liability.
  • Tend to be small businesses
  • No continuity
  • Profit is shared

Question 4

Question
In limited Partnerships both partners have limited liability
Answer
  • True
  • False

Question 5

Question
Which of these are advantages to the franchisee? Pick one or more.
Answer
  • Cost of support may be high
  • Set-up costs are predictable
  • Back-up support is given
  • Fast method of growth
  • Strict contracts have to be signed

Question 6

Question
Which describes best an incorporated business?
Answer
  • businesses where there is no legal difference between the owner and the business
  • Where the business has separate legal identity from that of its owners

Question 7

Question
Which of these are disadvantages to the franchisor? Pick one or more.
Answer
  • potential profit is shared with franchisee
  • Can be an expensive way to start a business
  • Poor franchisees may damage the brand’d reputation
  • Franchisees take most of the risk

Question 8

Question
Partnerships are strictly between 2 and 20 people
Answer
  • True
  • False

Question 9

Question
A franchisor is the owner who allows franchisees to operate under their name
Answer
  • True
  • False

Question 10

Question
Sole traders, partnerships and franchises all have limited liability.
Answer
  • True
  • False
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