1. Which of the following could be a problem for a partnership?
- The partners share unlimited liability
- The partners could differ in their opinion about how the business should be run
- The Partners each invest and thus raise more capital
- The partners have a variety of skills
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2. What does unlimited liability mean?
- Should the business go bankrupt, the owner could lose personal possessions to pay off debts
- Should the business go bankrupt, the owner will only lose what they have invested in their business
- The owner has unlimited choice over everything they do
- The business is liable to the Government
3. Which of these is not a benefit of being a Sole Proprietor?
- Unlimited Liability
- Being your own boss
- Making all the business decisions
- Deciding what to do with all the profit
4. What is the name of the legal document that partners can have drawn up to protect themselves?
- Partnership Agreement
- Deed of Partnership
- Deal of Partnership
- Contract of Employment
5. Why might a new business start as a Private Limted Company rather than a Sole Proprietor or Partnership?
- The owners will raise more capital by selling shares on the stock market
- The owners can buy bigger premises
- Despite the more complex and costly paperwork, the owners will be classed as a seperate legal entity to the business
- Despite the complex and costly paperwork, the owners will have unlimited liability
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