chap 8

Question 1

business organization

Answer 1

is an enterprise that produces goods or provides services, usually in order to make a profit.

Question 2

sole proprietorship

Answer 2

is a business organization owned and controlled by one person.

Question 3

limited life

Answer 3

is a situation where a business closes if the owner dies, retires, or leaves for some other reason.

Question 4

unlimited liability

Answer 4

means that a business owner is responsible for all the business’s losses and debts.

Question 5

partnership

Answer 5

is a business co-owned by two or more partners who agree on how responsibilities, profits, and losses of that business are divided.

Question 6

general partnership

Answer 6

partners share management of the business and each one is liable for all business debts and losses.

Question 7

limited partnership

Answer 7

is one in which at least one partner is not involved in the day-to-day running of business and is liable only for the funds he or she has invested.

Question 8

limited liability partnership

Answer 8

all partners are limited partners and not responsible for the debts and other liabilities of other partners

Question 9

corporation

Answer 9

is a business owned by stock-holders, who own the rights to the company’s profits but face limited liability for the company’s debts and losses

Question 10

stock

Answer 10

ownership in a corporation. A dividend is part of a corporation’s profit that is paid out to stockholders

Question 11

public company

Answer 11

issues stock that can be publicly traded.

Question 12

private company

Answer 12

controls who can buy or sell its stock

Question 13

bond

Answer 13

is a contract issued by a corporation that promises to repay borrowed money, plus interest, on a fixed schedule.

Question 14

limited liability

Answer 14

means that a business owner’s liability for debts and losses of the business is limited.

Question 15

unlimited life

Answer 15

means that a corporation continues to exist even after an owner dies, leaves the business, or transfers his or her ownership.

Question 16

horizontal merger

Answer 16

is the combining of two or more companies that produce the same product or similar products.

Question 17

vertical merger

Answer 17

is the combining of companies involved in different steps of producing or marketing a product.

Question 18

conglomerate

Answer 18

is a business composed of several companies, each one producing unrelated goods or services.

Question 19

multinational corporation

Answer 19

is a large corporation with branches in several countries.

Question 20

franchise

Answer 20

is a business that licenses the right to sell its products in a particular area

Question 21

franchisee

Answer 21

is a semi-independent business that buys the right to run a franchise.

Question 22

cooperative

Answer 22

is a business operated for the shared benefit of the owners, who also are its customers

Question 23

nonprofit organization

Answer 23

is a business that aims to benefit society, not to make a profit