A business firm is an organization that brings together the factors of production for the purpose of producing goods and services. 2 Businesses are characterized by specializing and the division of labor, as well as by a certain amount of risk. 3 Firms that produce identical or similar products are said to be in the same industry.
Many major companies produce products in more than one industry.
6 Advantages and disadvantages of the partnership as a form of business organization are essentially the same as those for an individual proprietorship, except on a different scale. A corporation is a form of business organization that is collectively owned by a number of individuals called stockholders, and that has the legal status of a single fictitious individual. 8 Corporations raise money by selling stocks and bonds. Common stock may yield higher income than preferred stock in the long run. In addition to individual proprietorships, partnerships, and corporations nonprofit organizations and cooperatives also provide goods and services.