Unit 3 Test Review Flashcards
Sole proprietorship
A business owned and managed by a single individual.
•Most popular in the United States.
•Advantages of sole proprietorship:
•Ease of Start-Up
•Most states have minimum requirements that include authorization, site permit, and name.
A business organization
Is an establishment formed to carry on commercial enterprise.
•Sole proprietorships are the most common forms of business organizations.
Business license
authorization to start a business issued by the local government.
Zoning laws
Sole proprietorships may also be subject to local
Liability
Is the legally bound obligation to pay debts.
•Even if the business fails, the owner is still responsible for the debt the business acquired.
Fringe benefits
are payments to employees other than wages or salaries.
A partnership
is a business organization owned by two or more persons who agree on a specific division of responsibilities and profits.
General Partnership
partners share equally in both responsibility and liability.
Limited Partnership
only one partner has unlimited personal liability for the firm’s actions.
Limited Liability Partnership (LLP)
all partners are limited partners.
Professional organizations
work to improve the image, working conditions, and skill levels of people in particular occupations.
Trade associations
are nonprofits that promote the interests of a particular industries.
Business associations
promote the collective business interests of a city, state, or other geographical area, or of a group of similar businesses.
Producer cooperatives
agricultural marketing cooperative that helps members sell their products.
Service cooperatives
they provide a service rather than a good.
Consumer cooperatives
retail outlet owned and operated by consumers.
Cooperative
is a business organization owned and operated by a group of individuals for their shared benefit.
Business franchise
is a semi-independent business that pays fees to a parent company.
Multinational corporations
are the world’s largest corporations that produce and sell their goods and services throughout the world.
Conglomerates
are firms that have more than three businesses that make unrelated products.
Vertical mergers
join two or more firms involved in different stages of producing the same good or service.
