You are planning to start a new business. You are going to open a catering business. You expect that the business will operate at a loss for the first two years due to start-up costs, and you have some concerns about liability. You plan to own this business yourself, but will hire someone with experience to do most of the day-to-day operations. You may be willing to share profits or grant a small amount of ownership in the future. You were considering an LLC, but are not sure if this is the best choice for you.

1. What are the advantages and disadvantages of an LLC for your catering business?

2. What are the benefits and risks of creating an operating agreement?

3. Certain business forms such as an LLC offer more protection for owners who know enough about the law that offers limited liability. This leads you to think back to the early weeks of the class and the ethical theories that you studied. Is it fair for the law to protect some people better than others because they are more knowledgeable about the law? Please discuss your viewpoint using one of the ethical theories discussed in Chapter 2.