Forms Of Business Organisation

15 Questions

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Forms Of Business Organisation

Business studies exam revision :)


Questions and Answers
  • 1. 
    The best definition of a sole trader form of business organisation is:
    • A. 

      The business only employs one person

    • B. 

      The business is owned by one person

    • C. 

      The firm has a single customer

    • D. 

      There is a single firm in the industry.

  • 2. 
          One of the claimed advantages of a sole trader business is that:
    • A. 

      Owners have limited liability

    • B. 

      Shares can be sold to raise capital

    • C. 

      Decisions and responsibilities can be shared

    • D. 

      The owner has independence

  • 3. 
    • A. 

      Capital is limited to owner’s savings and bank loans

    • B. 

      Decisions take too long to make

    • C. 

      As they are government owned there is no profit motive

    • D. 

      the owners may disagree.

  • 4. 
    • A. 

      All partners always have limited liability

    • B. 

      Shares can be sold on the Stock Exchange

    • C. 

      The business survives the death of the partners

    • D. 

      The business has access to more capital than a sole trader.

  • 5. 
    • A. 

      Shares can be issued to raise capital.

    • B. 

      Shares can be bought and sold on the Stock Exchange.

    • C. 

      All owners of the business have limited liability.

    • D. 

      The business continues after the death of shareholders.

  • 6. 
    • A. 

      It is owned by the government and is in the public sector.

    • B. 

      It is owned by shareholders who can sell their shares in the Stock Exchange.

    • C. 

      It is quick and easy to set up with few legal formalities.

    • D. 

      Its accounts can be kept private and it receives little coverage in the business

  • 7. 
    • A. 

      They do not want to remain in the private sector

    • B. 

      They want to gain the benefits of limited liability

    • C. 

      They want to keep the annual accounts secret

    • D. 

      They want to raise additional capital to expand the business.

  • 8. 
    • A. 

      There can be a loss of control by the original owners as additional shares are sold

    • B. 

      Firms in the public sector are often less efficient

    • C. 

      if the company were to fail the shareholders could lose all of their assets

    • D. 

      workers have to be asked for their opinions before major decisions are taken.

  • 9. 
    • A. 

      They are owned and controlled by the workers.

    • B. 

      They are owned by the directors but controlled by the shareholders.

    • C. 

      The are owned by shareholders but controlled by directors.

    • D. 

      They are owned and controlled by the government.

  • 10. 
    Which of the following statements about co-operative business organisations is true?
    • A. 

      All co-operatives are only concerned with retailing.

    • B. 

      Profits are shared equally amongst members.

    • C. 

      They are owned by shareholders.

    • D. 

      Workers have no say in decision-making.

  • 11. 
    • A. 

      It is always much cheaper than setting up a new business venture

    • B. 

      There is complete control over important decisions

    • C. 

      The business can use its own name in advertisements

    • D. 

      The risks of failure are lower as it is buying a well known business idea.

  • 12. 
    One of the advantages to a business of selling a franchise is that:
    • A. 

      The business can expand more quickly

    • B. 

      The franchisor owns all of the shops

    • C. 

      The businesses buying the franchises are certain to be successful

    • D. 

      The products sold in each shop will be different.

  • 13. 
    • A. 

      Expanding a business to all parts of the country

    • B. 

      When the government buys all of the assets of a private sector business

    • C. 

      When a private limited company applies to become a public limited company

    • D. 

      Opening a new division of the business in another country to become a multinational.

  • 14. 
    • A. 

      the costs of a new project can be split between the companies involved

    • B. 

      Manufacturing costs will be divided between the firms in the venture

    • C. 

      Joint ventures between firms in different countries can create new market opportunities

    • D. 

      Management of the joint venture will never lead to disagreements

  • 15. 
    • A. 

      In cases where monopolies are likely to occur, public corporations will be best for consumers

    • B. 

      In declining industries, public corporations, with government subsidies, would attempt to avoid job losses

    • C. 

      By aiming to maximise profits public corporations will always make money for the government

    • D. 

      a public corporation television service could make non-profitable programmes.