Description should include the definition, examples, and legal ramifications for the common business entities:

Sole proprietorship—owned by one person
Partnership (general and limited)—owned by a small group of people, usually two or three
Corporation (e.g., LLC, S-Corp, benefit corporation)—owned by a number of people, operated under written permission from the state, with a separate legal personality from its owners
Franchise—business opportunity that allows the franchisee to start a business by legally using someone else’s (i.e., the franchisor’s) expertise, ideas, and processes
Nonprofit corporation—formed to conduct a charitable, educational, religious, literary, or scientific purpose; does not pay federal or state income taxes from activities in which it engages to conduct its objectives
Cooperative—an association of persons united voluntarily to meet common economic, social, and cultural needs and aspirations through a jointly owned and democratically controlled enterprise

Process/Skill Questions:

What are the advantages and disadvantages of each type of business ownership?
Why is sole proprietorship such a popular choice of business ownership?
How does franchising allow an individual to operate his/her own business?
Why do most business consultants encourage entrepreneurs to incorporate?
What type of business ownership classification would be most appropriate for your dream business? Why?
What are the legal responsibilities for an entrepreneur's selected business in the local community?
Why is it essential to know local legal responsibilities before starting a business?
Why is drafting a partnership agreement essential when forming a partnership?
What is unlimited liability? How does unlimited liability affect a business owner?
How do shareholders participate in business operations?

Teacher Resources: