Which of the following statements is correct?
A)A hostile takeover is the primary method of transferring ownership interest in a corporation.
B)The corporation is a legal entity created by the state and is a direct extension of the legal status of its owners and managers, that is, the owners and managers are the corporation.
C)Unlimited liability and limited life are two key advantages of the corporate form over other forms of business organization.
D)In part due to limited liability and ease of ownership transfer, corporations have less trouble raising money in financial markets than other organizational forms.
E)Although stockholders of the corporation are insulated by limited legal liability, the legal status of the corporation does not protect the firm's managers in the same way.

Question

Quizplus · Accepted Answer

Corporations benefit from limited liability, meaning owners (shareholders) are not personally responsible for the company's debts, and ease of ownership transfer through the buying and selling of stock. These features make it easier for corporations to raise funds in financial markets compared to other forms of business organizations, which may face more challenges due to factors like unlimited liability or more complex transfer of ownership.

Which of the Following Statements Is Correct