DECA+ Business Management and Administration Practice Exam 2025 – All-in-One Guide to Guaranteed Success!

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What is an advantage of a sole proprietorship?

Limited liability for debts

Complete control by the owner

A sole proprietorship is a business structure where an individual owns and operates the business independently. One of the key advantages of this structure is that it allows the owner to have complete control over all aspects of the business. This means the owner can make decisions quickly without needing to consult with partners or a board of directors, enabling more agile and responsive management. The owner also retains all profits generated by the business, which can further incentivize strong performance and personal investment in the venture.

In contrast, other structures like partnerships or corporations can dilute this control as they involve multiple stakeholders or formal governance processes. The ability to steer the business in the direction the owner sees fit is a significant benefit of operating as a sole proprietorship.

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Ability to raise capital easily

Tax benefits for corporate entities

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