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America Essay

679 words - 3 pages

Chapter 9 : Business Firms in the Economy Proprietorships , Partnerships and Corporations are all forms of business organizations are what makes business function in the economy. Proprietorship is a form of business in which there is only one owner ,therefore the money that the business makes is the owner's money , however the disadvantage of proprietorship is the concept of unlimited liability which is ,that the owner's possessions can be used to pay the bills of the business. Partnerships is the type of business where there are two or more owners , thus the owners must agree on a legally binding document called a partnership agreement. One disadvantage of a partnership is that the owners may have the potential for a disagreement among ideas or issues that can lead to inefficient operations and can even end the partnership. Corporations are organizations of people legally bound together by a charter to conduct some type of business. The type of business a corporation can partake is decided upon the Articles of incorporation that state requesting permission to form a corporation . If the articles of incorporation satisfy state and federal laws, a charter which is the legal authorization to organize a business as a corporation becomes a legal entry.One way a corporation can raise money is by stock. An advantage of a corporation is the concept of limited liability , yet a disadvantage are dividends which is the part of a corporation's income which are earned to pay its stockholders. With all the business' there are in our economy , all business must survive the test of the market which indicates that business need to provide goods that satisfy consumer needs at the desired prices.In the United States, there are a number of firms that distribute goods and services for consumers such as General Motors, Mobil , Pepsi and Wal-Mart. Firms start off small and if success is in their hands they may grow to become bigger firms with a national reputation. The world of business today is...

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