1. Unit 9, Lesson 3: Types of Businesses
Agenda:
ORCA
Go over Supply headlines
Types of Businesses outline & Lexington examples
Outcome: Students will be able to describe the types of businesses in a market economy.

2. Today: Types of Businesses outline in Civics Today, p. 480-485
2. Can you name an example in Lexington of a:
Sole proprietorship?
Partnership?
Corporation?
Cooperative? (add to outline)

3. Unit 9, Lesson 3: Types of Businesses
Agenda:
ORCA
Go over types of Businesses & Lexington examples
Types of businesses videos
Lesson 4 outline & review questions
Outcome: Students will be able to describe the types of businesses in a market economy.

4. Proprietorship
The most common form of business organization in the United States is the sole proprietorship
Sole proprietorship: business owned and operated by one person
Many beauty salons, restaurants, hobby stores, and lawn care services are sole proprietorships

5. Setup of a Proprietorship
Structure: generally anyone can start a sole proprietorship whenever they want to if they have the resources needed
Advantages: the owner has the pride of owning the business and receives all the profits; decisions can be made quickly since there is no “higher-up” to consult
Disadvantages: owners have unlimited liability, the owner is financially responsible all problems with the businesses
Sole proprietors also can have difficulty raising money to run or grow the business
Small business also often struggle to attract the best employees since the aren’t as established and may not offer the same benefits

6. Partnerships Partnership: business owned by two or more people
Structure: Partners draw up a legal agreement called articles of partnership; documents how much money each will contribute and what role each will play in the business and says how they will share profits and losses
Advantages: Partnerships can usually raise more money or take in more partners to get money, they don’t pay corporate taxes, and the partners can each use their unique skills
Disadvantages: legal structure is complex and the partners have unlimited liability

7. Corporations
Corporation: business recognized by law that has many of the rights and responsibilities of an individual
Structure: first someone who wants to start a corporation must get a charter, a government document granting permission to organize
Charter also specifies the amount of stock that will be issued
People who buy the stock, the stockholders, own the corporation and elect a board of directors to run the corporation

8. Advantages of a Corporation
Corporations can raise more money by selling more stock and can usually borrow larger sums of money; makes expanding the business easier
Some corporations are bigger than the entire economies of many countries
Board of directors can hire professional managers to run the business and can be easily replaced if they aren’t successful
Ownership of the corporation can easily transferred by buying or selling stock
Corporations have limited liability, if the business fails you only lose the money you invested

9. Disadvantages of a Corporation
Corporations are often expensive and complex to set up
Business owners have very little say in the management of the business, only a few stock holders have enough shares to get change
Corporations are subject to more regulation by government than other forms; they must release reports about the financial standing of the company
Stockholders are subject to double taxation: the corporation has to pay income taxes and the stock holders have to pay income taxes of those earnings

10. Other Business Organizations
Non-profit organization: operates in a business like way to promote the interest of its members, goal is not to make a profit
Cooperative: voluntary association of people formed to carry on some kind of activity that serves its members; beef cooperative

11. 3 types of businesses: http://www. youtube. com/watch
3 types of businesses: Cooperatives CSA

12. Complete the Lesson 4 outline p
Complete the Lesson 4 outline p. 508 – 513 “Measuring the Economy” and answer the review questions.