If managers of a private corporation perform poorly, each owner has the option of
A)closing down the firm
B)selling her share of the firm
C)managing the firm herself
D)paying no taxes on the little profit she does receive
E)selling off the plant and equipment of the firm

Question

Quizplus · Accepted Answer

Selling her share of the firm is the best choice because it allows the owner to divest herself from a poorly performing company and potentially recoup some of her investment. The other options (closing down the firm, managing the firm herself, paying no taxes on the little profit she does receive, and selling off the plant and equipment of the firm) are either difficult, not feasible, or could result in further financial loss.

If Managers of a Private Corporation Perform Poorly, Each Owner