Although Most New Firms Start Out as Sole Proprietorships, Few

question 151

Essay

Although most new firms start out as sole proprietorships, few large firms are organized this way. Why is the sole proprietorship such a popular form of ownership for new firms? What features of the sole proprietorship make it unattractive to growing firms?

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Definitions:

Mean Time Between Failures

The average time interval between the occurrences of consecutive failures in a system or component.

Inverse

In mathematics, it refers to a function that essentially reverses the effect of another function, often denoted as the reciprocal or opposite in certain contexts.

Preventive Maintenance

A maintenance strategy aimed at preventing machinery, equipment, and systems failures by performing regular, planned maintenance tasks.