How Do a Sole Proprietorship and a Corporation Differ

question 34

Multiple Choice

How do a sole proprietorship and a corporation differ?

• A)Proprietorships have unlimited liability while corporations have limited liability.
• B)Corporations can issue stocks and bonds, while proprietorships cannot.
• C)Corporations face more taxes than do proprietorships.
• D)All of these are differences between the two types of businesses.

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Definitions:

Profit Margin

A financial metric that calculates the amount of earnings exceeding costs, often expressed as a percentage of revenue.

Less Risky Decision

A decision-making approach that prioritizes options with lower potential for negative outcomes or loss.

Mindguards

Individuals within a group who limit access to information to prevent dissent or critical thinking that might challenge the group's consensus.

Protecting

Ensuring safety or defending something from harm, damage, or adverse conditions.