Which of the Following Statements Is True of a Sole

question 29

Multiple Choice

Which of the following statements is true of a sole proprietorship?

• A) A sole proprietorship is the most expensive type of business to start.
• B) The life of a sole proprietorship is limited.
• C) Sole proprietorships must rely on equity contributions from the public.
• D) The liability of owners of a sole proprietorship is limited.

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Definitions:

Instrument

A formal document, such as a contract, will, or security, that legally records a right, obligation, or transaction.

Good Faith

The honest intention to act without taking an unfair advantage over another party, based on the belief that others will similarly act honestly.

Altered

Changed, modified, or adjusted from the original state or form.

Green Grocer

A retailer specializing in the sale of fresh produce, including fruits and vegetables.