Page 144 - Business Principles and Management

C HAPTER 5 A SSESSMENT

DETERMINE THE BEST ANSWER

9. A business owned and managed by one person is a
a. proprietorship
b. sole proprietorship
c. limited partnership
d. either a or b
10. The SBA sponsors free consulting help through
a. Entrepreneurship Support Centers (ESCs)
b. Small Business Development Centers (SBDCs)
c. SBA Development Centers (SDCSs)
d. all of the above
11. Part-time proprietorships are common because
a. part-time proprietors do not need to pay taxes
b. part-time proprietorships work well for stay-at-home parents
c. part-time proprietors have limited liability
d. part-time proprietors are more likely to make money
12. Limited partnerships are characterized by all of the following
(in some states) except
a. the limited partner has limited financial liability
b. at least one partner must be a general partner who has unlimited
liability
c. the name of a limited partner may not be included in the firm
name
d. all of the above are characteristic of a limited partnership in
some states

APPLY WHAT YOU KNOW

13. Explain how a good business plan will help someone successfully
open a new business.
14. Describe what kinds of businesses are most suited to the proprietor-
ship form of business ownership.
15. Explain the types of situations in which a limited partnership would
be most useful.
16. Explain why it is necessary for proprietorships and partnerships to
register their company names with local authorities.
17. Your friend follows your advice and writes a business plan to create
a new business called Cookies to Go. She does not include a mar-
keting plan and you mention it. She says, “Everyone likes cookies.
My prices depend on how much it costs to make each type of cookie.
And there isn’t a cookie store within three blocks of where I plan
to locate my business. How could I go wrong?” List questions that
should be answered in the marketing plan that would make your
friend give more thought to her decision.
18. You have been working part-time and summers at a local service
station. You have performed just about every task from pumping
gas to repairing cars and even handling some of the bookkeeping.
Discuss how your responsibilities as an employee will change if
you become the owner of the station.

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