A very important consideration in picking a legal form of business is_________.
A)how long you plan to run the business
B)how much legal liability you are willing to accept
C)how successful you believe your business will be
D)how many competitors you expect to have

Question

Quizplus · Accepted Answer

The legal liability that the owner(s) of a business are willing to accept is a crucial factor in determining the form of business. Some forms of business, like sole proprietorship, offer no legal protection for personal assets and leave the owner(s) fully liable for any debts or legal issues of the business. Other forms, like a corporation, offer limited liability, meaning the owner(s) are not personally responsible for the business's obligations. So, depending on the owner(s) risk tolerance, choosing the legal form of business is a critical decision.

A Very Important Consideration in Picking a Legal Form of Business