Question

question 53 (1 point)
when comparing general partnerships to sole proprietorships, an advantage of partnerships is that they
are less risky, because each partner is responsible for only a specified fraction of the firms debts.
are easier to terminate.
cost less to organize.
give the firm a stronger financial foundation.
question 54 (1 point)
an owner of a corporation is known as a
general partner.
limited partner.
director.
stockholder.
question 55 (1 point)
a separation between ownership and management is most likely to occur in a
sole proprietorship.
general partnership.
corporation.
limited liability partnership.

Explanation:

Question 53

• In a sole proprietorship, there is only one owner. In a general partnership, there are multiple partners. With more partners, there is more capital contribution (each partner can bring in their resources), which gives the firm a stronger financial foundation compared to a sole - proprietorship (where the financial resources are limited to one person's savings, borrowing capacity etc.).
• In a general partnership, partners have unlimited liability. So, the statement “are less risky, because each partner is responsible for only a specified fraction of the firm's debts” is wrong. Sole - proprietorships are easier to terminate (no need to consult multiple partners) and cost less to organize (no partnership agreement drafting etc. in the same complexity as a partnership).

Question 54

• A general partner is an owner of a partnership. A limited partner is also an owner of a limited - liability partnership. A director is a person who manages the corporation on behalf of the owners. A stockholder (or shareholder) is the owner of a corporation as they own shares (equity) in the corporation.

Question 55

• In a sole proprietorship, the owner manages the business. In a general partnership, partners (owners) manage the business (unless there is a special agreement otherwise). In a limited - liability partnership, partners (owners) have some management rights. In a corporation, there is a large number of stockholders (owners) who are not involved in day - to - day management. The management is entrusted to professional managers, leading to a separation of ownership (stockholders) and management.

Answer:

• Question 53: give the firm a stronger financial foundation.
• Question 54: stockholder.
• Question 55: corporation.