From a shareholder's viewpoint, what is the key benefit of limited liability?

Question

Quizplus · Accepted Answer

Limited liability means that shareholders are not personally responsible for the debts of the company beyond the amount they have invested or promised to invest. This protects their personal assets, which is a key benefit for shareholders. Choice B and C are not entirely accurate, as the company's liabilities may exceed its authorised capital or assets, and shareholders may not always be able to recover their investment. Choice D is not correct, as shareholders are not only liable up to what the company owes its creditors, but up to the amount they have invested or promised to invest.

From a Shareholder's Viewpoint, What Is the Key Benefit of Limited