Question

5. Briefly describe the four types of business structures that can be used to organize agribusinesses and farms. List the similarities and differences of the structures. Notes on Exercise 1: The exercise is to be completed in Microsoft Word. Use "Insert, Shapes" to draw the line diagrams. You can use a table to answer question 4.

Answer 1

5) Four types of business structure that can be used in organised agribusiness are

• Partnership: It is formed when there is an agreement between two or more person or enterprises or traders to carry on the business together, they are individually responsible for the activities of the partnership, both the partners will have the same level of profit enjoyed from the business along with the perfect distribution of liability
• Joint Venture: A joint venture is a relationship that exists between parties carrying on a particular commercial undertaking in common for their individual gains as opposed to mutual gain
• corporation: Corporation or company has their independent legal status and they can enter into contracts with their own name and incur debts in their own name
• Cooperative: Cooperative is registered legal entity but it needs at least five shareholders each of them has equal voting rights , it is established on the concept of sharing, democracy and delegation in order to benefit all the members.
• partnership and joint venture are almost same from their basic concept but in partnership they get mutual profit their objective is to have mutual gain but in joint ventures people tries to achieve their individual gain
• Similarly company and cooperative are legally same as both of them registered but for cooperative the objective is more welfare based than a company , cooperative always try to maximize their social welfare keeping a basic standard profit level which is not in the case of company

4)

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