The Major Reason Why Businesses Change from Sole Proprietorships to Other

question 76

Multiple Choice

The major reason why businesses change from sole proprietorships to other forms of ownership is to

• A) gain unlimited liability.
• B) avoid unlimited liability.
• C) avoid lack of continuity.
• D) obtain help and eliminate the problem of too much to do in one day.
• E) offer advancement opportunities for employees.

---

Definitions:

Equilibrium Interest

The interest rate at which the quantity of loanable funds demanded equals the quantity supplied, balancing savings and borrowing.

Loanable Funds

The money available for borrowing in the financial markets, influenced by interest rates and economic conditions.

Useful Life

The period during which an asset is expected to be usable for its intended purpose.

Interest Rate

The cost of borrowing money or the return on invested capital, typically expressed as a percentage of the principal amount per period.