Question

one reason that businesses want to combine with other businesses is to
a) reduce expenses.
b) hire more workers.
c) avoid taxes.
d) delay expenses.
question 12 (5 points)
listen
in what way might a partnership be better than a sole proprietorship?
a) liability is limited.
b) profits are split.
c) setup costs are higher.

Explanation:

• For the first question:
• When businesses combine (e.g., through mergers or acquisitions), they can achieve economies of scale. This means they can produce goods or services more efficiently. For example, they can bulk - buy raw materials at a lower cost per unit, or share overhead costs (like marketing or administrative costs) across a larger operation. So, reducing expenses (Option A) is a valid reason. Hiring more workers (Option B) is not a primary reason for business combination as the goal is often efficiency rather than just workforce expansion. Avoiding taxes (Option C) is illegal in most cases when done through improper means, and while there might be some legal tax - planning aspects in business combinations, it's not the main, widely - accepted reason. Delaying expenses (Option D) is not a strategic long - term goal of business combination.
• For the second question:
• In a sole proprietorship, the owner has unlimited liability (they are personally responsible for all business debts). In a general partnership (assuming it's not a limited partnership), while partners still have some liability, in some cases (like in a limited partnership where there are limited partners), liability can be limited. Splitting profits (Option B) is a characteristic of a partnership but it's not an advantage over a sole proprietorship (where the sole owner keeps all profits). Higher setup costs (Option C) is a disadvantage of a partnership compared to a sole proprietorship.

Answer:

• First question: A. reduce expenses
• Second question: A. Liability is limited