More than 99% of firms have fewer than 50 employees

Less than 1% of firms have 250 or more employees

Between them, firms with fewer than 50 employees account for under 50% of the total turnover (that is total sales) of all firms

Between them, firms with 250 or more employees account for under 50% of the total turnover of all firms

All firms must pay corporation tax on their profits

Both sole proprietorships and partnerships have unlimited liability

All companies have limited liability

Internal finance arises when a company finances new assets by using past profits

It is the risk that a principal who hires or employs an agent to perform a task may find that the task is done poorly

It is least likely to arise in cases where there is asymmetric information

It may be reduced in the case of a company if its directors are given bonuses that relate to the company’s profits

It may be reduced in the case of a company if its directors fear their company may be subject to competition for corporate control

There are many firms in both perfect competition and monopolistic competition

Costs must be kept as low as possible in both monopolistic competition and monopoly

There may be homogeneous products in both perfect competition and oligopoly

There are barriers to entry in both oligopoly and monopoly

They help to make a market contestable

They may include a fear of sunk costs

They may include a lack of know-how

They may include the well-known brand names of existing firms