Question

Compared with the sole proprietorship and partnership forms of business organization, the corporate form generally faces with _______ agency problems, ________ difficulty in raising capital and transferring ownership, ________ taxation.

Answer 1

Answer: more; less; more

Explanation:

Compared with the sole proprietorship and partnership forms of business organization, the corporate form generally faces with (more) agency problems, (less) difficulty in raising capital and transferring ownership, (more) taxation.

Corporation are typically taxed more than the sole proprietorship or partnership. Also, in sole proprietorship, the business owner and the management is thesame person and therefore isn't faced with agency problem like the corporate bodies. One main advantage of the corporate entity is that they raise more capital when compared to the sole proprietorship or partnership.