1. Microeconomics 2 Business Organizations

2. Sole proprietorship A form of business organization that is owned and managed by one individual who assumes all risk of loss and receives all profits.

3. Partnership A form of business organization that is owned by two or more individuals who assume all risk of loss and receive all profit.

4. Corporation A form of business organization that is created by law, functions as a separate legal entity, and is owned by two or more individuals called stockholders. Stockholders are at risk only for the amount of their financial investment.

5. Franchising a system by which a firm expands into new neighborhoods and towns (or foreign countries) by selling the rights to use the company's name and products to individuals. The franchising company provides training services and an advertising campaign for the purchaser of the franchise. In turn, the purchaser agrees to meet certain quality standards, provide certain products, and pay a franchise fee to the franchising organization.

6. Which would you like to be? Form a group Form a group No more than 4 members No more than 4 members Compare the 4 business types. What are the advantages of each? What are the disadvantages for each? Compare the 4 business types. What are the advantages of each? What are the disadvantages for each? Use this information to help you begin to determine what form of business you will create. Use this information to help you begin to determine what form of business you will create. Consider ideas for your company. School OK! Consider ideas for your company. School OK!

7. Advantages and disadvantages of types of ownership Advantages Disadvantages Sole proprietorship43 Partnership33 Corporation33 Franchise43

8. Exit Slip Group member names Group member names Form of business preferred Form of business preferred Ideas for business Ideas for business MUST be turned in BEFORE you walk out. No exceptions! THIS IS FUN!!!!!!!!!!!!!!!!!!!!!!! MUST be turned in BEFORE you walk out. No exceptions! THIS IS FUN!!!!!!!!!!!!!!!!!!!!!!!