Which of the Following Is Typically the Major Factor in Limiting

question 28

Multiple Choice

Which of the following is typically the major factor in limiting the growth of sole proprietorships?

• A) The organizational structure of such firms tends to become extremely complicated over time.
• B) It is extremely difficult to transfer control of such firms to a new owner if the present owner dies or wishes to sell the firm.
• C) The amount of money that can be raised by such firms is limited by the fact that the single owner must make good on all debts.
• D) Investors have a great deal of control over the day-to-day running of such firms, leading to confusion when conflicts in direction arise.

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Definitions:

Privatization

The process of transferring an enterprise or industry from the public sector to the private sector.

Government

The system or group of people governing an organized community, often a state, and the mechanism by which state policies are enforced and public affairs managed.

Unintended Consequences

Unintended consequences are outcomes that are not foreseen or intended by a purposeful action.

Congress

The legislative branch of the United States federal government, composed of two chambers: the Senate and the House of Representatives, responsible for making laws.