Question detail
CycleNest serves health-conscious consumers while cutting delivery times; the case evidence includes cash inflow of ?2,903, sales of 698 units, and a 8% change in costs or demand. Which option best applies Analyse benefits and drawbacks of each legal structure, including management and control, sources of finance, liability and profit distribution?
Try the question, check the answer, then read the explanation to understand the curriculum point.
At a glance
MCQ
Type
practice
Style
Topic
Business ownership
Question
- A. Use control, profit distribution, sources of finance to judge cash inflow, shareholders impact, and the business objective in Benefits, drawbacks and suitability.
- B. Give only a definition of Business ownership without using the case evidence.
- C. Treat gross and net profit as identical and ignore the effect on shareholders.
- D. Choose the largest sales figure without checking costs, finance, or context.
Answer
The correct option is: Use control, profit distribution, sources of finance to judge cash inflow, shareholders impact, and the business objective in Benefits, drawbacks and suitability.
Explanation
This is the best-supported choice because Use control, profit distribution, sources of finance to judge cash inflow, shareholders impact, and the business objective in Benefits, drawbacks and suitability. The case evidence gives ?4,403, 698 units, and 8%, so the answer must explain the commercial effect rather than repeat a definition. The distractors are weaker because they confuse gross and net profit, miss the shareholders, or ignore the business objective.
Common mistake
Benefits, drawbacks and suitability common mistake 1
Giving a vague answer instead of directly addressing: Analyse benefits and drawbacks of each legal structure, including management and control, sources of finance, liability and profit distribution..
Answer by clearly explaining how to analyse benefits and drawbacks of each legal structure, including management and control, sources of finance, liability and profit distribution..
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