BMGT 340 Lecture Notes - Lecture 1: Shanghai Stock Exchange, Dunne D.5, Takeover

• School: University of Maryland
• Department: Business and Management
• Course: BMGT 340
• Professor: Michael Padhi

Document Summary

The four types of firms: sole proprietorships. Largest number of firms but makes smallest total revenue. Roughly the same advantages and disadvantages as sole proprietorship. Limited liability for owners in a limited partnership for limited partners only: limited liability companies (llc) All of the owners have limited liability but unlike limited partners, they can also run the business. Owner"s liability is limited to the amount they invested in the firm. Stockholders are not responsible for any encumbrances of the firm: they cant be required to pay back any debts incurred by the firm: corporations. Smallest number of firms but makes the most total revenue. Efficient way of structuring contracts between a number of self- interested parties such as bondholders, shareholders, bod, suppliers/customers, managers/employees, government, and community. The firm"s profits (and losses) are not subject to corporate taxes, but instead are allocated directly to shareholders based on their ownership share.