BUS 210 Week 2 Individual Assignment Knowledge Check


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BUS 210 Week 2 Individual Assignment Knowledge Check

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Complete the Week Two Knowledge Check.
 
 
Which of the following best describes limited liability as it relates to a business?
A. The stockholder’s financial liability is limited to a fixed
investment amount.
B. Limited liability discourages entrepreneurs to start new
businesses.
C. If the business fails, personal assets of the owner(s) are at
risk.
D. Creditors are entitled to recover outstanding debt beyond
the financial assets of the business.
2.
What was the original purpose of the limited liability company?
A. To encourage investors to take financial risks to ensure a
business’ success
B. To control specialization of new businesses
C. To favor creditors with the ability to seek recovery of
assets to repay debt
D. To limit financial risk exposure and encourage formation
of new businesses
3.
Which of the following businesses is the best example of when to set up a limited liability
company in order to control financial risk of the stockholder(s)?
A. Hertz Car Rental
B. Joe’s Neighborhood Pet Store
C. Prudential Insurance
D. Wal-Mart
Concept: Partnership
Mastery 100% Questions 4 5 6
4.
Which of the following best describes a partnership?
A. Friends who share new business interests by sharing rent
costs
B. Families who work and live together to reduce costs
C. Skilled professionals who pool their talents and resources
to share general capital costs
D. All employees are stockholders to promote loyalty to the
company
5.
If a business partnership grows, what is usually added over time?
A. More revenue allocated to management
B. Increased stock percentage for partners
C. New professional members adding capital into the
business
D. Management control
6.
Which of the following is the best example of a business partnership?
A. Restaurant owners who share the same cuisine in a
common geographic area
B. Employees of a large computer manufacturer
C. Politicians who share expenses for a campaign
D. A group of similar professionals who start a company
together
Concept: Sole Proprietorship
Mastery 33% Questions 7 14 15
7.
Who assumes all liability for debt created in a sole proprietorship?.
A. The stockholders
B. The bank
C. The business partners
D. The business owner
14.
Which of the following businesses best matches the definition of a sole proprietorship?
A. Lawyers, bankers, or accountants
B. Dentists, carpenters, or plumbers
C. Bus drivers, hotel managers, or painters
D. Professors, nurses, or taxi drivers
15.
What is an obstacle that entrepreneurs avoid by choosing to form a sole proprietorship?
A. Competition
B. Risk
C. Disputes
D. Debt
Concept: Joint-Stock
Mastery 33% Questions 8 9 10
8.
Which of the following best describes a joint-stock company structure?
A. One person assumes the liability for the business venture.
B. Multiple professionals share general costs and
management leadership.
C. Stock ownership creates unlimited liability if the business
fails.
D. An entrepreneur raises capital by issuing stock ownership
for others to share the risk.
9.
Which of the following is the best advantage of a joint-stock company?
A. Investors have limited liability from creditors.
B. The investor limits the risk to the percentage of stock
ownership.
C. The business is resilient to poor management.
D. Investors determine the venture the company is required
to pursue.
10.
What is the best way to raise funding for a joint-stock company?
A. Secure an investment bank loan.
B. Raise capital from interested stakeholders.
C. Pool money from partners.
D. Issue stock certificates for investors.
Concept: Evolution of Business
Mastery 67% Questions 11 12 13
11.
Which of the following examples best illustrates feudalism from the standpoint of business
evolution?
A. The physical capital is privately owned.
B. Merchants and bankers organize and manage the trade.
C. One class of people owns all the property and people.
D. Price differences are exploited across markets.
12.
Which of the following examples best illustrates the mercantilism phase of business
evolution?
A. Bankers share the risk to determine how profits can be
shared.
B. A system allows people to personally own physical
capital.
C. The highest utility, or value, is invested or consumed for
the market or country.
D. Trade was advanced by improvements in technology.
13.
Which of the following examples best illustrates the capitalism phase of business
evolution?
A. Aristocrats own all valuable resources.
B. The higher the price for a product means the product is in
short supply.
C. Merchants take advantage of different markets in
international trading venues.
D. The business system allows people to own resources to
distribute goods and services.
 

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