Which of the Following Is True Regarding André's and Sasha's

question 24

Multiple Choice

Which of the following is true regarding André's and Sasha's quest to find the best form of business organization?

• A)A double sole proprietorship avoids corporate double taxation and also shields assets of the owners from tort claims of third parties although creditors may reach the personal assets of the owners.
• B)An unincorporated cooperative combines the tax advantages of a partnership with the limited liability of a corporation.
• C)A joint venture is a type of undertaking involving joint stock which is treated as a corporation in regard to double taxation and limited liability.
• D)A limited liability company combines the tax advantages of a partnership with the limited liability of a corporation.
• E)An S corporation provides the tax advantages of a partnership but does not avoid personal liability for shareholders.

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Definitions:

Terms of Sale

The conditions and stipulations under which a sale is conducted, including payment, delivery, and warranty details.

Economies of Scale

The cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output decreasing with increasing scale.

Natural Monopoly

A market condition where a single firm can supply a good or service to an entire market more efficiently than if there were multiple suppliers, due to high fixed or startup costs.

Investor Owned

Pertains to a business or entity that is privately owned by investors who seek to earn profits from the operation.