Jeremy Is Thinking of Starting Up a Small Business Selling

question 204

Multiple Choice

Jeremy is thinking of starting up a small business selling NASCAR memorabilia.He asks his friend, Carmen, if she'd like to join him in setting up a partnership to start the business.What is one disadvantage in joining the partnership that Carmen should consider?

• A)Carmen should realize that profits in the partnership will be reduced by dividend payments to shareholders.
• B)Carmen should realize that, as an owner of the business, she will be personally responsible for the debts of the business.
• C)Carmen should realize that the profits of the business will also be taxed as dividend income, so she faces the potential for double taxation of that business income.
• D)Carmen should realize that the Jeremy will have complete control over the business because it was his idea.

---

Definitions:

Approachable

being easy to approach or talk to; friendly and open to communication or contact.

Cooperative

Involving mutual assistance in working toward a common goal, characterized by the willingness of individuals to work together.

Impression Management

The process by which individuals attempt to control the perceptions others have of them, often to align with their own desired image.

Systematic Attempt

A methodical and organized effort to achieve a specific goal or solve a problem.