Which of the Following Types of Business Ownership Could Be

question 65

Multiple Choice

Which of the following types of business ownership could be formed based only on an oral agreement?

• A)partnership
• B)limited liability company
• C)nonprofit organization
• D)corporation

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Definitions:

Government Failure

Occurs when government intervention in the economy causes more harm than good, leading to inefficient allocation of resources or failing to achieve desired policy outcomes.

Economically Inefficient Outcomes

Situations where resources are not allocated optimally, leading to wasted potential or benefits.

Incentive Structures

Systems or processes designed to motivate individuals to perform certain actions by offering rewards or punishments.

Principal-Agent Problem

Refers to a situation in business where there is a conflict of interest between a principal (e.g., an owner or shareholder) and an agent (e.g., a CEO or manager) hired to act on the principal's behalf.