Which statement best describes the most significant difference between a business firm and a nonprofit organization?
A) Business firms operate with larger budgets than nonprofits.
B) Nonprofit organizations do not carry on economic activities while business firms do.
C) Nonprofit organizations are concerned with social issues and business firms are not.
D) Both serve customers, but business firms seek a profit while nonprofit organizations do not.
E) Nonprofit organizations are publicly owned and business firms are privately owned.

Question

Quizplus · Accepted Answer

The most significant difference between a business firm and a nonprofit organization is their primary goal. Business firms seek to make a profit for the owners or shareholders, whereas nonprofit organizations aim to achieve a social or charitable purpose. Both may serve customers, but the driving force behind their decisions and actions is fundamentally different. The other options are not accurate because nonprofits may have significant budgets, engage in economic activities, be concerned with social issues, and may or may not be publicly owned.

Which Statement Best Describes the Most Significant Difference Between a Business