Kara wants to build a business. She has plenty of capital and potential investors and partners. She wants to avoid the burden of sole liability for her business and wants to be
able to close the business when she is no longer interested in it. Which of the following would lead Kara to choose a sole proprietorship organization for her business?
Plenty of capital
Many potential investors/partners
Ability to close the business easily
Avoidance of sole liability



Answer :

Final answer:

A sole proprietorship involves one person owning and managing a business, with the owner bearing personal liability for debts and obligations. Consideration of the risks and benefits is crucial when opting for a sole proprietorship.


Explanation:

Sole proprietorship is a type of business organization where a single individual owns and operates the business, assuming all profits and losses.

One of the main disadvantages of a sole proprietorship is the unlimited liability the owner faces, making them personally responsible for all debts and obligations of the business.

Despite the advantages of ease of management and decision-making, the owner's personal assets are at risk in the event of bankruptcy or lawsuits, highlighting the importance of carefully considering the implications of choosing a sole proprietorship.


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