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GCE Economics 1989 Question 20

Question 20

Business Organisations

One of the advantages of a sole proprietorship is that

  1. A.risks are unlimited
  2. B.technological progress is often out of reach
  3. C.shares and stocks can be issued to raise funds
  4. D.initiative can be used in all cases
  5. E.it folds up in the case of death, lunacy or insolvency.
Show the answer and explanation

Answer: D (initiative can be used in all cases)

Explanation

The sole owner takes decisions alone and quickly, so he can use his own initiative; the other options are disadvantages or false.