A company has no legal liability to repay shareholders the amount they have invested.

Question

Quizplus · Accepted Answer

Shareholders invest in a company with the understanding that there is no guarantee of a return on their investment and that they bear the risk of losing their money if the company does not perform well. Therefore, a company is not obligated to repay shareholders their investment. However, some companies may offer to buy back shares or pay dividends to shareholders as a goodwill gesture or as a means of attracting more investors.

A Company Has No Legal Liability to Repay Shareholders the Amount