Types of Business Ownership 1
Which type of business ownership involves a single owner with unlimited liability?
Sole Proprietorship
What is the primary disadvantage of a C Corporation?
Double taxation
How does the federal government pay for the regulations and services it provides?
by collecting business and personal income taxes, and by borrowing money
Which government agency enforces the food and drug laws?
FDA
Local governments can protect business property by restricting certain businesses occupying certain areas using:
Zoning laws
Which type of business ownership involves selling shares on a stock exchange?
Public Corporation
What must a business file to legally establish itself as a corporation?
Articles of Incorporation
Throughout history, the role of government in business has changed. When the constitution was written, what was the federal government’s role in business?
issue patents to inventors
impose tariffs on imported goods
settle disputes between businesses
Which government agency enforces fair competition laws?
FTC
Consumers have the most power with this type of market model.
Pure competition
In which type of business structure are the owners called members?
Limited Liability Company
Which type of corporation can have up to 100 owners who must be U.S. citizens or permanent residents?
S Corporation
What fiscal policy tools does government use to stimulate the economy?
lower taxes
Healthcare privacy is protected by:
HIPAA
The Federal Government uses “monetary policy” to effect the economy. Monetary policy tools include:
interest rates and money supply
Which business structure passes corporate income (or loss) to its shareholders for tax purposes?
S Corp
What is the main difference between a public corporation and a private corporation?
Public corporations sell shares to the public; private corporations do not
Which monetary policy tools does government use to stimulate the economy?
lower interest rates
Tariffs intend to raise government revenues and promote the sale of ______________ products.
American made
When a small number of companies control the supply of a good or service, and where the barriers to entry for other companies are highly restrictive, it is called:
Oligopoly
What is a major regulatory requirement for public corporations?
Public reporting of financial information
Why might a company choose to remain a privately held corporation instead of going public?
To avoid the requirement to publicly report financial information
The Federal Reserve, also called the “central bank” and the “Fed”, was created in 1913, and currently has a dual mandate – what mandates are part of the dual mandate?
achieve stable prices (keep inflation in check) and achieve maximum sustainable employment
Local governments can refuse to grant, or take away existing _____________ to certain businesses that aren’t qualified or that are performing poorly.
Business Licenses
When there are many suppliers, and barriers to entry are low, but suppliers try to differentiate their products and gain some price advantage, this is called:
monopolistic competition