gs_-23_--_Business_Organization

gs_-23_--_Business_Organization - ANNOUNCEMENTS (#1): Test...

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1 ANNOUNCEMENTS (#1): ± Test will be held at from 7:30 am to 9:00 am. ± SCHEDULE OF EXAMS: o TEST #1 – and TEST #2 -- DONE! o TEST #3 – March 10, 2010 (Wednesday) -- tentative o FINAL EXAM – To be announced – [FINAL EXAM WEEK] 2/19/2010 Econ 11 -- Lecture #23 2 AFTER TODAY’S LECTURE WE WILL SHIFT TO MACROECONOMICS ( RED BOOK) Lecture #23: BUSINESS ORGANIZATION ± Types of Business Organization ± Cooperatives vs. Corporations ± How businesses grow
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2 4 Forms of BUSINESS ORGANIZATIONS ± Proprietorship ± Partnership ± Corporation ± Cooperative 2/19/2010 Econ 11 -- Lecture #23 5 PROPRIETORSHIP ± Owned by a single person ± Easy to organize ± “Unlimited liability” Æ all business debts may be on the account of owner if business fails ± Limited financial capacity Æ typically very small Æ financing mainly from individual source 2/19/2010 Econ 11 -- Lecture #23 6 PARTNERSHIP ± An association of at least two persons to engage in business ± Partnership agreement can be written or oral ± Unlimited financial liability ± There could be limited partners – partners with limited liability ± Legal personality – recognized by law: can sue or be sued as an entity ± Unpredictable lifetime – based on partners
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3 Econ 11 -- Lecture #23 7 EXAMPLES PARTNERSHIP PROPRIETORSHIP Most family businesses are single proprietorships Most common enterprise – individual businesses; anyone can set up a business, even without registration with the government EXAMPLES PARTNERSHIP PROPRIETORSHIP Professionals tend to form partnerships – these often are registered with the government. accountants, engineers, doctors, architects, etc. Most family businesses are single proprietorships Partnerships are also very common; some exist with only the agreement of the partners to pool capital and have a business activity Most common enterprise – individual businesses; anyone can set up a business, even without registration with the government 2/19/2010 Econ 11 -- Lecture #23 9 CORPORATION ± Requires a charter or articles of incorporation, formed by at least 5 organizers and has: o legal personality o continuous life o
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gs_-23_--_Business_Organization - ANNOUNCEMENTS (#1): Test...

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