Introductory Business Law CLEP Prep Practice Exam

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Prepare for the Introductory Business Law CLEP Exam. Study with flashcards and multiple choice questions, each question comes with hints and explanations. Ace your exam with confidence!

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What is an example of a form of business that is not a separate entity from the business owners?

Trust
LLC
S Corporation
Sole proprietorship

The correct answer is: Sole proprietorship

An example of a form of business that is not a separate entity from the business owners is a sole proprietorship. In this type of business, the owner and the business are seen as one entity, meaning the owner has unlimited liability and is personally responsible for all debts and legal obligations of the business. The other options, such as a trust, LLC, and S Corporation, are all considered separate legal entities, meaning the owners have limited liability and are not personally responsible for the debts and legal obligations of the business. Therefore, they are not examples of a business that is not a separate entity from the business owners.