Company lawLesson 3 of 4 in the course Forms of Business Ownership

Cooperatives and Joint Ventures as Collaborative Business Forms

5 flashcards · 5 quiz questions · 5 match pairs · 5 fill-in sentences · English

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Summary

This lesson explains how cooperatives organize people to meet shared economic needs. Unlike businesses controlled primarily by outside investors, cooperatives are owned and democratically controlled by the people who use them or contribute to them.

A cooperative is a business owned and democratically controlled by its members. Members may be customers, producers, workers, or other people who use the cooperative’s services. Its central purpose is to meet members’ needs, rather than to accumulate capital for outside investors.

All flashcards

What is a cooperative?
A business owned and democratically controlled by members who use its services, produce for it, or work in it.
What does “one member, one vote” mean in a cooperative?
Each member has an equal vote, regardless of differences in purchases or contributions.
How does a buyer cooperative help members?
It pools members’ purchasing power to improve buying terms or efficiency.
How does a seller cooperative help producers?
It coordinates shared marketing and sales activities so producers can reach markets more effectively.
What is a joint venture?
An alliance of two or more companies formed to pursue a specific project, usually for a specified period.

Quiz questions

  1. Who owns and democratically controls a cooperative?Answer: Its members, who may use its services, produce for it, or work in it.
  2. What does “one member, one vote” mean in a cooperative?Answer: Each member has an equal vote, even if purchases or contributions differ.
  3. How does a buyer cooperative most directly help its members?Answer: It pools purchasing power to improve buying terms or efficiency.
  4. Farmers contribute dues to fund shared advertising for their crops. Which cooperative type fits this arrangement?Answer: A seller cooperative, because producers coordinate efforts to market their goods.
  5. Which statement best describes the purpose of a cooperative?Answer: It is organized primarily to meet its members’ needs.

Based on Introduction to Business 2e by Lawrence J. Gitman, Carl McDaniel, Amit Shah, Monique Reece, Linda Koffel, Bethann Talsma, James C. Hyatt (OpenStax), licensed CC BY 4.0. Adapted into a summary, flashcards and quizzes.

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