1.3 Business Ownership

• Match the type of business ownership with its definition:

  Sole Trader ↔️ A business owned and controlled by one individual

  Partnership ↔️ A business owned by two or more people who share profits and losses

  Private Limited Company (Ltd) ↔️ A business owned by shareholders with limited liability, not publicly traded

  Public Limited Company (PLC) ↔️ A business owned by shareholders, publicly traded on a stock exchange
• A sole trader is a business owned and controlled by one individual
• Match the advantage with the disadvantage of a sole proprietorship:

  Easy to set up and operate ↔️ Unlimited liability

  Owner retains full control ↔️ Difficulty raising capital

  Profits taxed at individual income rate ↔️ Limited life span
• Match the advantage with the disadvantage of a partnership:

  Shared expertise and skills ↔️ Shared liability

  Shared financial responsibility ↔️ Potential for conflict

  Flexible management ↔️ Limited life span
• Match the advantage with the disadvantage of a partnership:

  Shared expertise and skills ↔️ Unlimited liability

  Shared financial responsibility ↔️ Potential for conflict
• In a partnership, partners have limited liability for business debts.

  False
• Partnerships allow for the combination of expertise and skills among partners.


  True
• A private limited company is not publicly traded on a stock exchange
• A sole trader has full control of their business but unlimited liability
• What is a key advantage of a sole proprietorship?

  Easy to set up
• What is a partnership in business terms?

  Business owned by two or more people
• What happens to a partnership upon the death of a partner?

  It ends
• Match the business type with its key feature:

  Sole Trader ↔️ Unlimited liability

  Private Ltd ↔️ Corporate tax

  Partnership ↔️ Personal income tax
• Shareholders in a PLC have limited liability
• Cooperatives operate on a one member, one vote basis.


  True
• Franchises benefit from established brand recognition
• Franchises provide a middle ground by offering brand recognition and shared resources.

  True
• A franchise is a business model where a franchisor licenses their brand and operating model
• What does business ownership refer to?

  Legal structure of a business
• What is a partnership in business ownership terms?

  Owned by two or more
• A sole trader has unlimited liability, meaning their personal assets are at risk.


  True
• A PLC has dispersed ownership and control compared to a sole trader.

  True
• Profits of a private limited company are taxed at the corporate tax rate
• What is a key difference between a public limited company (PLC) and a private limited company (Ltd)?

  Shares publicly traded
• How do cooperatives distribute profits among their members?

  Level of participation
• The profits of a PLC are taxed at the corporate tax rate.


  True
• Cooperatives operate on a one member, one vote basis.

  True
• Cooperatives focus on mutual benefit rather than maximizing profit for shareholders
• Franchisees must follow the franchisor's proven business model
• Who owns a franchise in the franchise model?

  The franchisee
• What are the main legal structures for business ownership?

  Sole proprietorship, partnership, Ltd, PLC, cooperative, franchise
• Match the business type with its advantage:

  Sole Trader ↔️ Full control

  Private Limited Company ↔️ Limited liability

  Franchise ↔️ Established brand

  Cooperative ↔️ Mutual benefit
• The type of business ownership affects factors like control, liability, access to finance, and taxation.

  True
• A Public Limited Company (PLC) is publicly traded on a stock exchange.


  True
• The owner of a sole proprietorship faces unlimited liability for business debts.

  True
• In a partnership, all partners have unlimited liability for the business debts.


  True
• What financial responsibility is shared among partners in a partnership?

  Raising capital and losses
• The limited life span of a partnership is triggered by the withdrawal or death of a partner
• Disagreements between partners in a partnership can lead to conflict
• Arrange the following types of business ownership in order of their access to finance, from least to most:

  1️⃣ Sole Trader

  2️⃣ Partnership

  3️⃣ Private Ltd

  4️⃣ Public Ltd