Forms of Ownership is one of 9 topics in the Grade 8 Economic and Management Sciences CAPS syllabus, covered across 3 lessons on Study Vault. Below are real practice questions from this topic with full worked answers.
Sample practice questions
Easy
1. What is a key disadvantage of being a sole trader?
Unlimited liability, meaning personal belongings could be used to cover business debts
Having to share all profit with partners
Needing thousands of shareholders to start the business
Being legally unable to make any business decisions alone
Answer: Unlimited liability, meaning personal belongings could be used to cover business debts — A sole trader carries unlimited liability, meaning there is no legal separation between the owner's personal belongings and the business's debts.
Easy
2. What is a partnership?
A business owned by two or more people who agree to run it together
A business owned by shareholders on a stock exchange
A business owned entirely by government
A business with absolutely no owner
Answer: A business owned by two or more people who agree to run it together — A partnership is a business owned by two or more people, called partners, who agree to run the business together and share in its profits.
Medium
3. What is a key advantage of a partnership over a sole trader?
Bringing together more skills, ideas and capital than a single person could provide alone
Automatically removing all liability from every partner
Making it illegal for partners to disagree
Requiring no paperwork to set up at all
Answer: Bringing together more skills, ideas and capital than a single person could provide alone — Partnerships bring together more skills, more ideas and more capital than a single person could provide alone, since each partner can contribute their own money, knowledge and effort.
