Question

The fate of sole proprietorship is connected to the sole proprietor. What does this convey about the sole proprietorship?

• A. Unlimited liability
• B. Uncertain life
• C. Limited managerial ability
• D. Lack of economies of scale

Answer 1

Answer: (B)

Uncertain life

The fate of sole proprietorship is connected to the sole proprietor. This conveys about uncertain life about the sole proprietorship. In sole proprietorship type of business the single individual takes all initiatives and run the business. 'Sole' means singe and 'proprietorship' means ownership. The business organization in which the single owner owns, manages and controls all the activities of the business is known as sole proprietorship form of business organization.