Question

In: Finance

Which of the following is/are an advantage of corporation? A. Limited liability B. Access to capital...

Which of the following is/are an advantage of corporation?

A.

Limited liability

B.

Access to capital markets

C.

Unlimited life

D.

All of the above

Solutions

Expert Solution

Answer D.

All options are the characteristics or features of a corporation, hence all are beneficial to it.

When it comes to limited liability, it is helpful as the liability of members is only limited to the amount guaranteed by them or the value of shares held by them. Nobody is personally liable for the company's debt. The access to capital market helps the companies to raise funds from the government and other sources. Unlimited life or perpetual succession means life of the company will go on. The reasons like demise, insolvency, retirement or the insanity of the associates do not affect the company standing.


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