Which of the Following Statements Is CORRECT

question 28

Multiple Choice

Which of the following statements is CORRECT?

• A) It is generally more expensive to form a proprietorship than a corporation because, with a proprietorship, extensive legal documents are required.
• B) Corporations face fewer regulations than sole proprietorships.
• C) One disadvantage of operating a business as a sole proprietorship is that the firm is subject to double taxation, at both the firm level and the owner level.
• D) One advantage of forming a corporation is that equity investors are usually exposed to less liability than in a regular partnership.
• E) If a regular partnership goes bankrupt, each partner is exposed to liabilities only up to the amount of his or her investment in the business.

Identify the characteristics and behaviors of different groups of product adopters (innovators, early adopters, early majority, late majority, and laggards).

Understand the differences and purposes of alpha and beta testing in product development.

Identify sources of new product ideas and understand their importance in innovation.

Evaluate the benefits and drawbacks of test marketing versus launching based on experience or instinct.

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Definitions:

MC

Marginal Cost, the increase or decrease in the total cost of a production run for making one additional unit of an item.

Long Run

A period in economic analysis where all factors of production can be varied, and no inputs are fixed.

Shut Down

The process of ceasing operations, often temporarily, due to various reasons like lack of demand, financial trouble, or external circumstances.

Diminishing Returns

The principle stating that if one factor of production is increased while others remain constant, the overall returns will eventually decrease after a certain point.