Business Law Chapter 38 Quiz

When setting up a business, one should consider the three principal forms of organizing a business, including:

a. sole proprietorships, partnerships, and corporations.

Who among the following is responsible for managing the business in a business corporation?

b. Directors

A member of an unincorporated association is generally:

b. not liable for the debts of the association.

Front-line Promotions and Insights Promotions formed a ″joint venture″ to produce two events with musical and celebrity talent at the NBA All-Star Weekend. Which of the following is true of this scenario?

c. Both the parties combine their labor or property for a single undertaking and share profits and losses equally.

Which of the following is true of the duration of a business corporation?

c. It has perpetual life.

The risk of financial loss to a shareholder of a corporation is:

c. limited to the amount of capital he or she invested in the business or paid for shares.

To protect themselves against litigation, franchisors often require individual franchisees to:

c. maintain their own individual business identities.

A major disadvantage of a partnership in a business is:

c. that each partner is personally liable for the debts of the partnership.

An arrangement in which a group of two or more persons or enterprises acts through a common agent with respect to a common objective is a(n):

cooperative

An advantage of franchising for the franchisor is:

d. only the franchisee will be liable to third persons for contracts that are breached by the franchisee.