Class 11 BSt Chap2 Case based

Chapter 2: Forms of Business Organisations

**Case Study:**

Raj and Simran have started a digital marketing agency that specializes in social media marketing and search engine optimization for other businesses. They began as a partnership due to the ease of setting up and the combined skills they bring to their venture. However, they are considering incorporating as they grow and take on more clients.

**Questions:**

1. **Which form of business organization are Raj and Simran currently using?**

   - A) Sole proprietorship

   - B) Partnership

   - C) Corporation

   - D) Cooperative

2. **What is a major advantage of the current form of business organization used by Raj and Simran?**

   - A) Limited liability

   - B) Perpetual succession

   - C) Flexibility and direct rewards

   - D) Easy transfer of ownership

3. **If Raj and Simran decide to incorporate, what would be a likely new benefit they would gain?**

   - A) Increased personal liability

   - B) Decreased control over management

   - C) Access to more capital

   - D) Simpler taxes

4. **Considering the risks associated with digital marketing, what is a potential drawback of remaining as a partnership?**

   - A) Unlimited personal liability

   - B) Limited skills and capabilities

   - C) Limited financial resources

   - D) Inflexible decision-making