Which of the Following Statements About the Corporate Form of Business

question 79

Multiple Choice

Which of the following statements about the corporate form of business organization is TRUE?

• A)The corporate form has the disadvantage of double taxation relative to a sole proprietorship.
• B)The corporate form is preferred over the sole proprietorship because a corporation is easier to form and faces less regulation.
• C)Sole proprietorship is the most common form of business organization because liability is limited to the amount invested in the business by the sole proprietor.
• D)The corporate form has the advantage of unlimited liability.

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Definitions:

Reverse Causality

A situation where the supposed effect influences the cause, challenging the traditional direction of causation.

Confound

A variable that mistakenly appears to cause the observed effect but in reality is associated with both the supposed cause and effect, thus misleading the interpretation.

Temporal Order

The sequence in which events occur in time.

Random Error

Variability in measurement or data that arises by chance and cannot be attributed to a specific cause, affecting the accuracy of results.