Which of the Following Is a Difference Between a Corporation

question 179

Multiple Choice

Which of the following is a difference between a corporation and a sole proprietorship?

• A) The owner of a corporation has unlimited liability, while the owner of a sole proprietorship has limited liability.
• B) The owner of a corporation faces difficulty in raising startup money, while the owner of a sole proprietorship does not.
• C) A corporation makes zero economic profit in the long run, while a sole proprietorship makes positive economic profits in the long run.
• D) Corporate income is taxed twice, while income from a sole proprietorship is taxed only once.
• E) A corporation faces vulnerability in the case of the death of an owner, while a sole proprietorship does not.

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Definitions:

Knowledgeable

Possessing or showing a great deal of information, awareness, or understanding about specific subjects or topics.

Actor-Observer Effect

A cognitive bias in which people tend to attribute their own actions to situational factors, while attributing others' actions to their character or disposition.

Traffic

The movement of vehicles, ships, persons, or animals through an area, or the volume of this movement in a specified pathway or domain, such as internet traffic.

Cognitively Draining Task

Tasks that require a high level of mental effort and concentration, often leading to mental exhaustion.