Some corporate founders of Smith Company want to restrict the transferability of their stock and hold it in the hands of only a few individuals who are not
Allowed to sell it to the general public.What type of company is Smith
Company?
A)private corporation
B)public corporation
C)restricted corporation
D)partnership

Question

Quizplus · Accepted Answer

A private corporation is a type of company that is not publicly traded and has restrictions on who can own and sell its stock. In this case, the founders of Smith Company want to restrict the transferability of their stock to a few individuals, indicating that it is a private corporation. B) public corporation is incorrect because in a public corporation, the stock is available for sale to the general public. C) restricted corporation is not a recognized type of company. D) partnership is also incorrect as it is a type of business structure where two or more people share ownership and profits.

Some Corporate Founders of Smith Company Want to Restrict the Transferability