In Terms of the Costs to Organize Each,which of the Following

question 42

Multiple Choice

In terms of the costs to organize each,which of the following sequences is correct,moving from highest to lowest cost?

• A) general partnership, sole proprietorship, limited partnership, corporation
• B) sole proprietorship, general partnership, limited partnership, corporation
• C) corporation, limited partnership, general partnership, sole proprietorship
• D) sole proprietorship, general partnership, corporation, limited partnership

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Definitions:

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.

Natural Monopoly

A type of monopoly that arises because a single firm can supply a good or service to an entire market at a lower cost than could two or more firms.

Patent

A legal document granted by the government that gives an inventor exclusive rights to make, use, or sell an invention for a certain number of years.

Exclusive Right

A legal privilege granted to an individual or organization to be the sole provider or practitioner of a specific service or product in a particular area.