Small Firms Survive in Some Industries Because

question 57

Multiple Choice

Small firms survive in some industries because:

• A)the owner usually knows the workers by name.
• B)the gains from specialization are high.
• C)the incentives to shirk are low.
• D)the cost of monitoring employees is low.

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Definitions:

Personal Liability

The responsibility of individuals to repay debt or fulfill obligations from their own assets, distinct from corporate or shared liabilities.

Limited Liability

A legal structure where a company's owners are protected from personal responsibility for its debts or liabilities beyond their investment in the company.

Stakeholder Theory

A concept in organizational management and business ethics that emphasizes the importance of considering the interests of all parties affected by business activities, not just shareholders.

Financial Interests

Refers to the ownership stake or economic benefits that an individual or entity has in an asset or a transaction.