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Which of the given statements is true?

a) Most of the businesses (by number and total dollar sales) are organized as partnerships or proprietorships since it is simpler to set up and operate in one of such forms instead of as a corporation. Though, if the business gets very big, it becomes beneficial to convert to a corporation, mostly because corporations encompass significant tax advantages over the proprietorships and partnerships.

b) Due to limited liability, unlimited lives, and easiness of ownership transfer, the huge majority of U.S. businesses (in terms of number of businesses) are organized as the corporations.

c) Most of the business (measured by dollar sales) is conducted through corporations in spite of large corporation's frequently less favorable tax treatment, due to legal considerations associated to ownership transfers and limited liability.

d) Big corporations are taxed more favorably than the sole proprietorships.

e) Corporate stockholders are exposed to limitless liability.

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M915923

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