Final answer:
A small company that has fewer financial resources since they are limited to what the owner is able to borrow is called a sole proprietorship.
Step-by-step explanation:
A small company that has fewer financial resources since they are limited to what the owner is able to borrow is called a sole proprietorship. In a sole proprietorship, the owner is personally responsible for all the debts and obligations of the business.
This means that if the business fails to generate enough revenue to cover its expenses, the owner may have to use their personal funds or assets to repay any loans or obligations.
For example, if someone starts a restaurant and uses their own savings or takes out a personal loan to cover the startup costs, they are operating as a sole proprietorship.