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

Since the 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, it is clear that they want to maintain control over the company and not have it open to public ownership. This is a characteristic of a private corporation, as opposed to a public corporation where shares can be bought and sold by anyone on the open market.

Some Corporate Founders of Smith Company Want to Restrict the Transferability