Final answer:
The statement that all new businesses are considered sole proprietorships by law is false. Business owners have multiple forms of organization to choose from, not just the sole proprietorship.
Step-by-step explanation:
The statement “The law considers all new businesses to be sole proprietorships” is false. When starting a new business, the owner can choose from several forms of business organization including a sole proprietorship, partnership, corporation, S corporation, or a Limited Liability Company (LLC). A sole proprietorship is indeed one of the simplest and most common forms to establish when it is a single individual starting a business, as it is easy to set up and manage. However, it is not automatically presumed by law that all new businesses are sole proprietorships; the business structure must be selected and, if necessary, legally registered based on the chosen form.