Asked by
Michael Kolodin
on Nov 11, 2024
Verified
One disadvantage of a sole proprietorship as a form of business organization is that:
A) sole proprietorships cannot lower the transaction costs associated with contracting with resource owners.
B) sole proprietorships are less efficient than corporations,because they are less specialized in production.
C) owners of sole proprietorships can lose all their personal assets if the business is sued or fails.
D) owners of sole proprietorships generally find it difficult to negotiate separation agreements with the other partners in the firm.
E) owners of sole proprietorships generally have very little control over how they operate their businesses.
Sole Proprietorship
A business owned and managed by a single individual, with personal responsibility for all debts and legal actions.
Transaction Costs
The costs of time and information required to carry out market exchange.
Personal Assets
Items of value owned by an individual, including cash, bank accounts, investments, real estate, and personal property.
- Comprehend the fundamental principles and benefits of owning and operating a sole proprietorship.
- Familiarize oneself with the legal and economic duties linked to assorted business establishments.
Verified Answer
NR
Learning Objectives
- Comprehend the fundamental principles and benefits of owning and operating a sole proprietorship.
- Familiarize oneself with the legal and economic duties linked to assorted business establishments.