Which of the Following Is Correct with Respect to Sole

question 177

Multiple Choice

Which of the following is correct with respect to sole proprietorships?

• A) The sole proprietorship is a separate legal entity.
• B) The sole proprietor has unlimited liability.
• C) The sole proprietor has limited liability.
• D) Sole proprietorship exists where two or more people carry on business together with a view towards profits.
• E) A sole proprietorship must be incorporated.

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Definitions:

Depreciates

A decline in the value of an asset over time due to wear and tear, obsolescence, or market conditions.

British Pound

The official currency of the United Kingdom, also known as GBP or Sterling.

Exchange-rate Systems

These are frameworks established by countries to govern how their currencies exchange with one another, including floating, fixed, and pegged exchange rates.

Flexible-rate

A type of exchange rate regime where the value of a currency is allowed to fluctuate according to the foreign exchange market forces of supply and demand.