COMM 295 Chapter Notes - Chapter 7: Root Mean Square, Sunk Costs, Agency Cost
Document Summary
Chapter 7 - firm organization and market structure. Private = for-pro t that are owned by individuals and may earn a pro t. Public = owned by gov"t or agencies, called state-owned enterprises. Nonpro t = organization neither gov"t owned nor intended to earn a pro t. Publicly traded are on market that has shares readily bought . originally offered through. Closely held is owned by corporation referred to as private equity. If sole prop/partnership there is fully liable owners. Limited liability companies allow for separation of owners and companies entities. Large rms tend to be corporations and smaller rms are often sole prop. Small business starts as sole prop and is then incorporated as ops expand. In small private sector, there is owner-manager. In corps, shareholders own corporations yet play no meaningful role in day to day therefore a. Ceo and board of directors is elected to select managers and help maximize pro ts.
