ENTREPRENEURSHIP {CH. 7}

Which of the following is NOT an advantage to buying an existing business?

capital is not required because the business already exists

A(n) ____ is a business that has the legal rights of a person but is independent of its owners.

corporation

____ are distributions of corporate profits to the shareholders

dividends

A(n) _____ is a legal agreement that gives an individual the right to market a company's products or services in a particular area.

franchise

An existing business may have built up a considerable amount of ____ ____, or customer loyalty.

good will

A franchisee

is dependent on the performance of other franchisees in the chain

The MAIN reason entrepreneurs set up corporations is because

liability is limited to the amount of money each shareholder invested in the company

Owners of a limited liability company are known as ____

members

A business owned by two or more people is a(n) ______.

partnership

A(n) _____ is the grant of a property right to an inventor to exclude others from making, using, or selling his or her invention.

patent

A unit of ownership in a corporation is called a

share of stock

A business owned exclusively by one person is called a

sole proprietorship

The costs associated with beginning a business, such as renting a facility, equipping the outlet, and purchasing inventory, are called _____ costs.

startup

A corporation's board of directors is responsible for all of the following EXCEPT

the day-to-day management of the corporation

All of the following information is included in a Franchise Disclosure Document EXCEPT

the name, address, and phone number of all current franchisees

If you are considering buying an existing business, ask the current owner to provide you with a complete financial accounting of operations for at least

the past three years

A(n) ______ is a name, symbol, or special mark used to identify a business or brand of product.

trademark

A(n) _____ is an expert on determining the value of a business and can help an entrepreneur determine a price to offer for an existing busines

valuator

Local governments control the types of buildings that can be built in different areas through the use of

zoning regulations

This law protects small businesses from unfair pricing practices.

Robinson-Patman Act