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Which of the following shows a merit and a demerit of the type of business organisation mentioned in the above case?
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Which of the following shows a merit and a demerit of the type of busi...
Merit of the Business Organisation
- Limited Liability: One of the significant advantages of certain business organizations, such as limited liability companies (LLCs) or corporations, is that the owners (shareholders) have limited liability. This means they are not personally responsible for the company's debts beyond their investment.
- Attracting Investment: Limited liability can make it easier for such organizations to attract investors, as potential shareholders feel more secure knowing their personal assets are protected. This can lead to increased capital for expansion and growth.
Demerit of the Business Organisation
- Complexity in Structure: A demerit of this type of business organization is the complexity involved in its structure and operations. Setting up a corporation or LLC requires adhering to various legal formalities, which can be cumbersome and time-consuming.
- Regulatory Compliance: Additionally, these organizations often face stringent regulatory requirements, including regular reporting, audits, and potential taxation on corporate profits. This can lead to higher operational costs and reduced flexibility in decision-making.
In summary, while limited liability offers protection and can facilitate investment, the complexities and regulatory burdens can pose challenges for business operations.
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Manish is a student pursuing final year B.Tech. from IIT Kharagpur. His father Mr. Sambal Singh who owned a small general store in Jaipur had a heart attack and became completely paralysed. There was no other source of income for the family, so, Manish left his studies and decided to take charge of his father’s general store. While checking the books of accounts, he found that his father had taken a loan of ₹ 2 lakhs from Bank of Baroda to be repaid this year only, but the business is running into losses due to his father’s illness. Hence, his mother advised him to close the business and to look for a job outside. On the basis of the given case, answer the following questions:Q. Which of the following shows a merit and a demerit of the type of business organisation mentioned in the above case?

Read the following passage carefully and answer the questions given below it.Corporate social responsibility (CSR) is increasingly being practised in recent times as business organisations are taking a keen interest in human rights.Globalization, spurred on by technological innovations in the past, has led to an increase in the movement of labour, knowledge and technology among countries. And, companies have been setting up factories in countries with cheap labour and very poor Human Rights laws to enable them to cut production costs drastically. Governments of these poor countries have been forced to dance to the tune of large businesses. Although the growth and development of businesses worldwide has brought about an increase in the standard of living, on the other hand, it has resulted in the abuse of workers in many parts of the world.But a section of humanitarians have criticized businesses for their inhumane practices and have steadily raised concern over the use of child labour, low wages, female discrimination and abuse in factories. Also, the media is keeping a constant watch on corporate organisations that abuse humanity in any way or refuse to uphold their social responsibilities. Hence, the trend of incorporating ethics and values into business practices is on the rise, of late.As a result, organisations now pay more attention to business ethic, education and training in order to meet this ever-growing ethical responsibility. Corporate social responsibility has entered a new phase in which the social responsibility of business has to be clearly defined. According to Andrew Chapman and Scott Jerbi there are growing expectations that corporates should do everything within their powers to promote universal human rights even in conflict situations where governance structure has broken down.Globalization was spurred on by what factors?Corporate business practices resulted in which of the following?

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Which of the following shows a merit and a demerit of the type of business organisation mentioned in the above case?
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Which of the following shows a merit and a demerit of the type of business organisation mentioned in the above case? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Which of the following shows a merit and a demerit of the type of business organisation mentioned in the above case? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which of the following shows a merit and a demerit of the type of business organisation mentioned in the above case?.
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