Question

Explain firm and discuss its types.

Answer 1

A firm is termed as a business organisation that sells goods or services to make a profit.

Types of firms:

1) Sole proprietorship: The sole proprietor is owned and run by the one person and there is no legal difference between the trader and business entity.

2) Partnership: The partnership is owned and run by the two or more persons and similarly there is no legal difference between the trader and business entity.

3) Co-operation: A co-operation is by filing articles of incorporation with the state in which the company will be doing business.