Legal, Social, and Economic Environments of Business

Topics: Corporation, Limited partnership, Business law Pages: 3 (1004 words) Published: May 12, 2013
Rossalynn Thomas
American Intercontinental University

There are several categories that a small business can fall into. Within these businesses there are legal, social and economic environments that effect how the business is run and whether the business is a success or failure. From the cost to run to how the tax return is filed; all three have their advantages and disadvantages. All three also can produce a lucrative income for the right person or people. It is imperative to the business for the owner(s) to choose which path is the best way to go while taking in consideration the pros and cons of each type.

Legal, Social, and Economic Environments of Business
The idea of a three pronged cord came to me when I noticed how many cords have burned up on my appliances. The third prong on the cord would distribute the current better. My goal is to manufacture and sell my product. Small businesses are what formed our country. From the forming of our governments to starting computer companies in our garages business decisions had to be made. There are three main organizations of small businesses: Sole Proprietor, Partnership, and Corporation. When opening a business the owner or owners need to know how each organization operates and which would be the best for them. Each has its own advantages and disadvantages, but every business falls into one category or another. Business Organizations

Sole Proprietor: A sole proprietor is a single individual who makes all the decisions in the business. There is no one to run to and ask “What do you think about this?” It is the most simple of the three types because there are almost no legal requirements. As a sole proprietor there is more freedom to do what the individual wants which makes it much easier to run. Also, the individual can get a tax benefit and there is a lower cost to start (Tavassoli, 2013. Slide 9) Almost anyone can have a small business as...
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