1.3 Business ownership

• Business ownership refers to the legal structure under which a business operates
• A corporation is owned by shareholders
• An LLC protects the owner's personal assets from business debts.


  True
• Order the types of business ownership from least complex to most complex:

  1️⃣ Sole Proprietorship

  2️⃣ Partnership

  3️⃣ LLC

  4️⃣ Corporation
• One advantage of a sole proprietorship is that the owner receives all the profits
• In a Private Limited Company, the owners have limited liability
• Responsibility in a sole proprietorship is borne by the owner
• A private limited company is a separate legal entity from its owners


  True
• What is a disadvantage of a private limited company compared to a partnership?

  Regulatory compliance
• What type of legal entity is a PLC?

  Separate
• Match the business ownership type with its liability level:

  Sole Proprietorship ↔️ Unlimited liability

  Limited Liability Company (LLC) ↔️ Limited liability
• Which business ownership type is most complex?

  Corporation
• A partnership requires sharing profits and decisions
• A private limited company is owned by shareholders
• A sole proprietorship involves unlimited liability for the owner.


  True
• A sole proprietorship is owned by two or more individuals.

  False
• What is the legal liability for a sole proprietorship owner?

  Unlimited
• Corporations and LLCs both offer limited liability to their owners.


  True
• Partnerships always involve unlimited liability for all partners.

  False
• A sole proprietorship is owned by one person
• Unlimited liability is a disadvantage of a partnership compared to a sole proprietorship


  True
• A private limited company is owned by shareholders
• A private limited company is a popular choice for medium-sized businesses

  True
• Complex regulations are a disadvantage of a PLC


  True
• A sole proprietorship has the simplest setup


  True
• Sole proprietorships rely mainly on the owner's resources for capital


  True
• What type of liability does a private limited company offer to its owners?

  Limited
• Private limited companies offer limited liability to their owners.


  True
• Who owns a public limited company?

  Public shareholders
• What happens to the profits generated by a cooperative?

  Distributed to members
• Social enterprises reinvest their profits into social or environmental causes.

  True
• Franchises offer lower startup costs compared to starting a business from scratch.


  True
• In a franchise, the franchisee has unlimited liability.

  False
• Franchisees have complete independence in decision-making.

  False
• A partnership offers limited liability to its owners.

  False
• Partnerships always have unlimited liability.


  True
• Match the ownership type with its characteristic:

  Sole Proprietorship ↔️ Owned by one individual

  Partnership ↔️ Shared responsibility
• A private limited company is a separate legal entity
• Capital in a sole proprietorship is limited to the owner's resources
• A major disadvantage of a partnership is unlimited liability