By: Eric Watkins

Economics
Types Of Businesses
There Are Five Types of Businesses
Sole Proprietorships
Partnerships
Corporations
Franchises
Non Profit
Sole Proprietorship
A business owned and managed
by a single person
Convience stores are an example
of a sole proprietorship
Advantages: easy start-up, easy
to discontinue
Disadvantages: unlimited
personal liability, limited access
to resources
Government Laws and
regulations: need a business
license; sometimes subject to
local zoning laws

Partnerships
A business organization that is owned
by two or more persons who agree on
a specific division of responsibilities
and profits
A dentists office is an example of a
partnership
- Advantages: a larger pool of
assets, shared decision making
and specialization
- Disadvantages: unless
partnership is a limited liability
partnership (LLP), at least one
partner will have unlimited liability,
and potential for conflict
- Government Laws and
Regulations: only certain
partnerships may register as an
LLP, Uniform Partnership Act

Corporations
a legal entity owned by individual
stockholders, each of whom
faces limited liability for the firms
debts.
Machinery manufacturers are an
example of a corporation
- Advantages: the ability to
attract capital, and they can
transfer ownership, meaning
corporations will have a long
life
- Disadvantages: expensive
and difficult start-up, more
regulation and red tape than
other businesses
- Government Laws and
Regulations: Certificate of
incorporation, quarterly and
annual reports to the SEC
(Securities and Exchange
Commission)
Franchises
A semi-independent business that
pays fees to a parent company. In
return, the business is granted the
exclusive right to sell a certain
product or service in a given area.
Mcdonalds is an example of a
franchise
- Advantages: standardized
quality, finanacial assistance to
help hopeful owners capital to
start the business
- Disadvantages: strict operating
standards, limited product line.
- Government Laws and
Regulations: None?

Non Profit Organizations
an institution that runs like a
business organization, but provides
services rather than goods, and do
not operate to generate profit.
The American Red Cross is an
example of a nonprofit organization
- Advantages: Most of the
income of a non-profit is exempt
from income taxes, A nonprofit
organization can receive grants
or aid in contrast to business
entities that have to use loans
as a means of raising funds.
- Disadvantages: non-profit
organizations are subject to
stricter reporting requirements.
In case, the incorporators
decide to move onto some
other pursuits in life, they
cannot take along the assets
accumulated by the non profit
organization.
Government Laws and Regulations: filing a
request to start an NPO
Entrepreneur
An entrepreneur is an individual who
organizes and operates a business or
businesses, taking financial risk to do so
Two Examples of entrepreneurs are
Dean Kamen and Howard Hughes
Dean Kamen
Dean Kamen is an american inventor
and entrepreneur from New
Hampshire. He is best known for
inventing the product that eventually
became known as the Segway PT. He
is also the co-inventor of a
compressed air device that launches
humans high into the air, allowing swat
members or other emergency service
workers to the roof of tall, inaccessible
buildings. Prior to this, he was already
a successful and wealthy
inventor/entrepreneur, after inventing
the first drug fusion pump and starting
a company to help sell and make the
pump. He also owns DEKA, a
development company that holds
patents on portable dialysis machines,
an insulin pump (based on the drug
infusion pump), and an all terrain
electric wheelchair, called the IBOT,
which uses a lot of the same
technology that the Segway later
used.
Sam Walton
Sam Walton was an American businessman
and entrepreneur, best known for founding
Wal-mart and Sams Club. He was born in
Kingfisher, Oklahoma in 1918. He graduated
the University of Missouri with a bachelors of
Economics. He joined JC Penny as a
management trainee shortly after graduation,
but left in anticipation for World War 2. He
served in World War 2 as security supervisor
for prisoner of war camps before buying his
first franchise store in 1945. by 1962, along
with his brother bud, they owned 16 stores in
Arkansas, Missouri, and Kansas. He opened
the first true Wal-mart with his brother on
July 2
nd
, 1962 in Rogers, Arkansas. By the
time he died (April 5, 1992), there were
almost 2,000 Wal-mart stores around the
country, and had annual sales of $50 billion
from the 1,735 Wal-marts, 212 Sams Clubs,
and 13 Supercenters. He was the richest
person in the United States from 1982 to
1988, received the presidential medal of
freedom from President George H.W. Bush
in 1992,
Micro Credit
Micro credit is the extensions of small
loans to people in poverty who lack
collateral, a steady job, and no verifiable
credit history.
Microcredit works by giving small loans
to people with very low interest rates on
the loan so that whoever took the loan
out can start a business.
Muhammad Yunus
Muhammad Yunus is
a Bangladesh banker,
economist, and nobel
peace prize recipient.
He is the innovator of
microcredit and
microfinance.
He was awarded the
Nobel Peace Prize for
his efforts to create
economic and social
development from
below